Posted on: Tuesday 7 September 2021 – 6:50 AM | Last update: Tuesday 7 September 2021 – 6:50 AM
Reality TV star Kim Kardashian has faced criticism from the head of Britain’s Financial Conduct Authority for promoting an untested cryptocurrency on the social networking site Instagram.
Charles Randell, the authority’s president, said Kim “asked her 250 million followers to trade cryptocurrencies”, through an announcement placed on her Ethereum Max account.
Randell described the coin he says Kardashian is promoting as “a circulating digital currency launched by anonymous developers about a month ago.”
Britain’s top financial official also accused social media influencers of promoting “get-rich-quick delusions”.
These statements came while Randell spoke at the Cambridge International Cybercrime Forum.
The head of the British regulator said that the post that Kardashian put on her account on Instagram, which he noted was classified as an advertisement by tagging it indicating this, may have been “promoting a financial product directed to the largest audience in history.”
Randell emphasized that the Ethereum Max coin, which was promoted by Kardashian’s Instagram account, is not the well-known cryptocurrency Ethereum.
But he sounded skeptical when he said, “I can’t determine if this cryptocurrency (Ethereum Max) is a scam.”
“But social media influencers periodically get paid by scammers to help them launch new tradable cryptocurrencies. Some influencers also promote currencies of this type that don’t exist at all,” Randell added.
The BBC has reached out to Ethereum Max and Kardashian for comment on the FCA chief’s comments.
Randell said that 2.3 million Britons own cryptocurrency, 14 percent of whom use credit cards to buy them, “which increases the risk of loss,” he said.
He stressed that the British Financial Conduct Authority has warned on several occasions against buying “traded cryptocurrencies” whose trading is not governed by FCA rules or covered by any compensation scheme.
And the head of the commission warned: “If you buy it, you must be prepared to lose all your money.”
Randell said there has already been discussion of the possibility of putting in place controls to promote this type of asset to deal with consumer misperceptions that their money is protected — and “the nonstop misleading advertising tactics of some crypto companies.”