With cryptocurrencies crashing in a spectacular fashion, crypto investors are feeling the pressure. One question remains: who is to blame for the recent crypto crash and spates of misled investors?
Cryptocurrency exchanges that sold cryptocurrencies alongside advertisements deeming the coin as “safe” are feeling the heat. However, it seems celebrity personalities like Floyd Mayweather and Kim Kardashian have also used their image to promote financial mechanisms they perhaps did not entirely understand.
Recent figures show that investors worldwide lost at least $1.5tn as the market continues to crash. In the US, 46,000 people have complained to regulators concerning a total loss of $1bn since January last year.
Class-action lawsuits are bound, though, with both Kim Kardashian and Floyd Mayweather facing legal action for their involvement in what plaintiffs believe had been a pump-and-dump scheme all along.
The crash of EthereumMax, the project both stars endorsed is just one of many to be hit under the heavy blows of disillusioned cryptocurrency investors. Yet, no one is really sure whether celebrities are held accountable for promoting digital assets that later turned out to be a dud.
At least NBA’s Stephen Curry appeared in FTX’s commercial announcing he didn’t know what cryptocurrencies were or how they worked, but that FTX could be able to help him figure it out.
Meanwhile, The Securities and Exchange Commission (SEC) is launching an investigation to establish whether popular crypto exchanges have the guardrails to prevent insider trading.
SEC’s case is looking into the work of Coinbase, FTX, Kraken, Crypto.com, Binance and Bitfinex. Whether the market’s biggest players take note or walk away scot-free remains to be seen.
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