Kim Kardashian slapped with $1 million fine over a cryptocurrency post

Kim Kardashian has been ordered to pay more than $1 million by the Securities and Exchange Commission (SEC) over her involvement in a cryptocurrency project called EthereumMax.

The fine stems from an Instagram Stories post that Kardashian posted about EthereumMax's EMAX tokens, which the SEC determined that she didn't disclose was a paid advertisement, which is a violation of the SEC's federal securities laws that require a person must mention that its a paid promotion (if it is a paid promotion). According to the SEC, Kardashian agreed to pay the $1.26 million fine, which it says covers the initial $250,000 she was paid for the post, and any interest made.

Furthermore, Kardashian pledged that she would not promote any cryptocurrency projects or assets for the next three years. In a new video posted to the US Securities and Exchange Commission YouTube channel, Securities and Exchange Commission chair Gary Gensler explained that just because celebrities and influencers endorse investment opportunities, including cryptocurrency assets, it doesn't mean that the celebrity/influencer's promotional product is the "right" purchase for all investors.

"This case is a reminder that, when celebrities or influencers endorse investment opportunities, including crypto asset securities, it doesn't mean that those investment products are right for all investors. We encourage investors to consider an investment's potential risks and opportunities in light of their own financial goals," said SEC chair Gary Gensler.

Engadget reports that a survey indicated that nineteen percent of people that were made aware of the cryptocurrency project EthereumMax invested in the project. It should be noted that the value of EthereumMax's token plummeted by 98% just a day after Kardashian posted her Instagram Story, leading many investors to believe that Kardashian was involved in a typical pump-and-dump scheme.