Many celebrities and influencers have caught on to cryptocurrencies over the past year, including Kim Kardashian, Floyd Mayweather, Matt Damon and more. Crypto is a risky investment technique, especially without the necessary research and knowledge. Now celebrities are promoting crypto to their followers; it’s time to discuss some potential risks.
Back in June 2021, Kim Kardashian and Floyd Mayweather got into trouble after endorsing a cryptocurrency called Ethereum Max, a coin that is known to be potentially fraudulent. Enthusiasts booed Floyd Mayweather off stage for promoting EMAX at a Bitcoin conference in Miami. The UK’s Financial Conduct Authority targeted Kim Kardashian for her promotion of the coin on Instagram.
Why Is It Risky?
Celebrity endorsement is usually fine. However, promoting a financial asset without correct warning or knowledge could cause financial distress for followers. There are influencers out there getting paid to promote fraudulent tokens to boost speculations and use their following to get investors on board. Kim Kardashians Instagram ad didn’t explain the risks of investing in crypto, putting her followers at risk of investing cluelessly in a coin that is likely a scam.
The hype around these coins with celebrity endorsement generates a dread of missing out from some consumers who may have little understanding of their risks. There is plenty of stories when people have invested all their savings in assets like crypto and stocks only to lose it all and end up in financial ruin.
I recently had the opportunity to speak with The Telegraph regarding the current crypto-mania and as I said there, “people who follow them fundamentally trust them. They believe in them, they look up to them, they aspire to be like them. So, anything they say is going to be taken as gospel by a good percentage of their followers. ‘I endorse this product.’ ‘OK, great – let’s go and play with it'”. If celebrities and influencers continue to carelessly promote these assets it will result in lives being ruined and their names tarnished.
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