The plaintiffs maintain that the celebrities deceptively promoted the virtual currency EthereumMax, to profit from the sale of the ‘tokens’ once their value increased by more than 1,000%.

Television star Kim Kardashian, former boxer Floyd Mayweather Jr. and former basketball player Paul Pierce have been accused by a group of investors of being part of a scam, deceptively promoting a cryptocurrency to increase its value, and then profiting from it. its sale, a practice known in the financial world as ‘pump and dump’,  reports Reuters.

In the lawsuit , filed on January 7 in federal court in the state of California (USA), the plaintiffs maintain that the celebrities, in collusion with the creators of the cryptocurrency EtherumMax , promoted the currency through social networks and different events, with the aim of artificially inflating its price, and selling its ‘tokens’ once its value increased exponentially, thus benefiting “at the expense of its followers and investors.”

According to the document, EthereumMax began trading on May 16, 2021 with a transaction volume of $ 16.1 million and a price of $ 0.00000006 per unit; However, after it was promoted by celebrities, it reached an all-time high of $ 0.000000863 per unit at the end of May, an increase of 1.370% from its initial value. In addition, the cryptocurrency closed the month with a transaction volume of more than 100 million dollars, an increase of 632% in just two weeks.

However, after reaching its maximum price, the defendants, including the developers of the currency, took advantage of the relevant period to sell their ‘tokens’, obtaining substantial benefits. However, as the market saturated, the price of the currency plummeted in just a few days, reaching a price of $ 0.000000017 per unit in mid-July, a fall of 98% .

Given this situation, the class action lawsuit seeks that anyone who has invested in EthereumMax between May 14 and June 27, receive financial compensation for the damages caused by the alleged scam.

For their part, representatives of the cryptocurrency dismissed the allegations and maintained their innocence in the face of the accusations. “The misleading narrative associated with the recent allegations is riddled with misinformation about the EthereumMax project. We discuss the allegations and hope that the truth will come to light,” the firm said in a statement.

Although this scheme is considered illegal in other financial activities, such as buying and selling shares on the stock market, there are currently no regulations that prohibit it within the cryptocurrency market.