EthereumMax
Cryptocurrency token promoted by celebrities in 2021
- Entries
- 8
- On the record
- 3
- Stories
- 1
- Latest entry
- Feb 17, 2023
The record
EthereumMax was an online company that offered and sold digital EMAX tokens to the public, and according to SEC orders it made the tokens available for trading on a decentralized crypto trading platform starting around May 14, 2021. The SEC found that buyers would have had a reasonable expectation of profit from the company's efforts, which made the tokens investment contracts and therefore securities, and that the company frequently touted the token's price rise and promised rewards programs and sporting partnerships.
The company paid celebrities to promote the token. Through an intermediary it paid Kim Kardashian $250,000 for a June 13, 2021 Instagram post, and from May 24, 2021 it transferred EMAX tokens worth about $244,116 to Paul Pierce for posts on Twitter. The SEC settled with both without admissions or denials: Kardashian agreed to pay $1.26 million in October 2022 and Pierce $1.409 million in February 2023, and each agreed not to promote crypto asset securities for three years.
Token buyers filed a proposed class action in January 2022 in federal court in Los Angeles against co-founders Steve Gentile and Giovanni Perone, developer Justin French and the celebrity promoters, alleging a conspiracy to inflate the token's value; by January 2022 the token had lost 97 percent of its value, CNBC reported. Judge Michael Fitzgerald dismissed the suit in December 2022 as insufficiently supported under the heightened pleading standard for fraud, with leave to amend some claims.
Roles and honours on the record
- 2021 Issuer of EMAX tokens, offered and sold to the public and traded from about May 14, 2021 source
- 2021 Payer, through an intermediary, of a $250,000 promotional fee to Kim Kardashian source
- 2022 Token at the center of an investor class action against its co-founders Steve Gentile and Giovanni Perone and celebrity promoters, Central District of California source
Every entry, newest first
- Filed
2022-01 [filed] Class action accuses EthereumMax of running a pump-and-dump scheme, per court filing. Kim Kardashian paid $1.26M to settle the SEC's EthereumMax case
Stories in this file
The record, entry by entry
- 2021-05-14 Official EthereumMax made EMAX tokens available for public trading on a decentralized crypto asset trading platform, according to the SEC's later findings. SEC order, In re Kim Kardashian, Release No. 33-11116
- 2021-05-24 Official EthereumMax or its agents began transferring EMAX tokens to Paul Pierce in exchange for social media posts, making at least eight transfers through June 18, 2021, the SEC found. SEC order, In re Paul Pierce, Release No. 33-11157
- 2021-06-13 Official Kim Kardashian posted about EthereumMax on Instagram with a link to its website and #AD; the SEC found EthereumMax had paid her $250,000 through an intermediary and that she did not disclose the payment. SEC order, In re Kim Kardashian, Release No. 33-11116
- 2022-01 Filed EMAX investors sued the token's co-founders Steve Gentile and Giovanni Perone, developer Justin French, and promoters Kim Kardashian, Floyd Mayweather Jr. and Paul Pierce, alleging a conspiracy to artificially inflate the token's value, CNBC reported. CNBC report
- 2022-10-03 Official The SEC announced that Kardashian agreed, without admitting or denying its findings, to pay $1.26 million, including a $1,000,000 penalty, and not to promote crypto asset securities for three years. SEC press release 2022-183
- 2022-12-07 Ruled Judge Michael Fitzgerald of the Central District of California dismissed the investor suit as insufficiently supported under heightened pleading standards for fraud, allowing the plaintiffs to amend some claims; Kardashian's lawyer welcomed the ruling. CNBC report
- 2023-02-17 Official The SEC announced that Pierce agreed, without admitting or denying its findings, to pay $1.409 million over undisclosed paid EMAX promotions and misleading tweets, including a screenshot showing holdings much larger than his own. SEC press release 2023-34
Documents
- SEC order, In re Kim Kardashian, Release No. 33-11116 (Oct. 3, 2022)
- SEC order, In re Paul Pierce, Release No. 33-11157 (Feb. 17, 2023)
- SEC press release 2022-183, charges against Kim Kardashian
- SEC press release 2023-34, charges against Paul Pierce
- CNBC on the December 2022 dismissal of the investor class action