Online cryptocurrency promotion—and promotion on social media in particular—has garnered national media attention in recent months. First, the U.S. Securities and Exchange Commission (SEC) announced that it had entered into a $1.26 million settlement with Kim Kardashian in relation to her promotion of EthereumMax (EMAX) on Instagram. Then, in the wake of the FTX collapse, several media outlets have covered lawsuits targeting Tom Brady, Gisele Bündchen, Stephen Curry, Shaquille O’Neal, and other celebrities who all promoted the platform before it came crashing down.
Promoting cryptocurrency investment opportunities can be extremely lucrative for athletes, celebrities, and other high-profile individuals—with many earning hundreds of thousands of dollars for individual posts and stories. But, it can be extremely risky as well. While there is nothing inherently unlawful about promoting cryptocurrency online, promoters must do it the right way to avoid SEC scrutiny and civil litigation.
“With token issuers and trading platforms offering substantial fees, it isn’t surprising that many celebrities are dipping their toes in the world of online cryptocurrency promotion. But, as several recent cases show, doing so without a clear understanding of the rules that apply can prove extremely costly.” – Dr. Nick Oberheiden, Founding Attorney of Oberheiden P.C.
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