Socialite, model and businesswoman Kim Kardashian has been criticised by the head of the UK’s Financial Conduct Authority (FCA) for for promoting an untested cryptocurrency on Instagram, reports BBC.
Kardashian posted about crypto token to promote an advertisement for Ethereum Max.
Kim has 250 million followers on the photo-sharing app.
Charles Randell called it “a speculative digital token created a month before by unknown developers”. Randell has accused influencers of unknowingly fuelling the “delusions of quick riches”.
He was speaking to the Cambridge International Symposium on Economic Crime.
The FCA chairman said though Kim’s had been correctly flagged as an ad, it may have been the “financial promotion with the single biggest audience reach in history”.
He also clarified that Ethereum Max should not be confused with the Ethereum cryptocurrency.
“I can’t say whether this particular token [Ethereum Max] is a scam,” he said, adding that some social media influencers are being paid by scammers to help them pump and dump new tokens. There have been reports of some influencers promoting coins, which turned out simply not to exist at all.
BBC approached Ethereum Max and Kardashian for comments but there was no reply.
According to the report, currently about 2.3 million Britons hold cryptocurrency. The FCA chairman said 14% of them also use credit to purchase them.
He said the FCA had repeatedly warned people about the risks of holding “speculative tokens”. Some token are not regulated by the FCA or covered by any compensation scheme.
He asked people to be careful before buying these token or else they would lose all their money.
Randell said they were trying to regulate and address consumers’ misconceptions that their investments were protected.