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Increasingly, we are seeing high-profile celebrities such as Paris Hilton and Jimmy Fallon enter the world of digital assets, cryptocurrencies and NFTs. Now, Kim Kardashian has agreed to pay a $1.26 million fine to the Securities and Exchange Commission (SEC) for her illegal promotion of the EthereumMax (EMAX) token by failing to disclose a $250,000 payment she received to promote the property. Her actions violated the anti-promotional provisions of the federal securities laws, the SEC said in a press release.
SEC Chairman Gary Gensler said in a press release: “This case is a reminder that when celebrities or influencers endorse investment opportunities, including crypto-asset securities, that doesn’t mean those investment products are right for all investors.
We encourage investors to consider the potential risks and investment opportunities in light of their own financial goals. Ms. Kardashian’s case also serves as a reminder to celebrities and others that the law requires them to disclose to the public when and how much they are paid to promote securities investments.”
The statement went on to explain that: “Without admitting or denying the SEC’s findings, Kardashian has agreed to pay the aforementioned $1.26 million, including approximately $260,000 in disgorgement, representing her promotional payment, plus prejudgment interest and a $1 million penalty. Kardashian also agreed not to promote any crypto asset securities for three years.”
As someone with a net worth of close to $1.5 billion, the $1.26 million settlement is an easily forgettable amount of money for Kardashian compared to the money, time and reputational damage that could be incurred by taking legal action or dismissing the charges she filed SEC. .
While Kardashian’s case was certainly in the news, this was neither the first nor the last accusations the agency brought against public figures for their misdeeds involving crypto-asset promotions.
In 2018, boxer Floyd Mayweather Jr. and DJ Khaled were also charged with illegally promoting cryptoassets and failing to publicly disclose their payments received in the deal. It is extremely likely that Kardashian’s will not be the last case brought against a celebrity for their illegal involvement in crypto assets or NFT promotion. This is especially true as stars such as the aforementioned Hilton and Fallon have faced public criticism for their opaque promotions of NFTs without detailing their monetary involvement in the projects.
Binance plans a regional hub in Kazakhstan
Binance – the world’s largest crypto-asset exchange – has just signed an agreement with Kazakhstan’s Financial Supervision Agency to begin the development of a digital asset market in the region.
In a press release published on Binance’s website, it said that the company “has been granted a permanent license by the AIFC Financial Services Authority of Kazakhstan (AFSA) to operate a digital asset platform and provide custodial services in the Astana International Financial Center.” The development follows an earlier in-principle approval which stipulates that Binance needs to complete the entire application process to secure permanent authorization.
“The permanent license gives Binance the status of a regulated platform in Kazakhstan and confirms its strong compliance and security controls. The platform will be authorized to offer digital asset exchange and conversion services, fiat currency deposits and withdrawals, cryptocurrency custody and stock exchange trading.”
AFSA CEO Nurkhat Kushimov said in an earlier press release published by Binance: “Large investors seeking new markets need clear, well-administered rules, as well as high standards of regulatory practice. When a regulator meets these requirements, it creates a trust-based collaboration and an ecosystem where players can work safely and efficiently. We believe Binance’s work will further develop this vibrant ecosystem of the digital asset industry locally and regionally.”
Senator Introduces Crypto Safe Harbor Bill
Republican Sen. Bill Hagerty of Tennessee — who sits on the Senate Banking Committee — just introduced a new piece of legislation “that provides digital asset exchanges with a safe harbor from certain U.S. Securities and Exchange Commission (SEC) enforcement actions, providing clarity around classification digital assets and applicable obligations under existing securities laws without sacrificing consumer protection”.
The Digital Trading Clarity Act of 2022 seeks to provide some degree of security and flexibility for the crypto industry, which has faced increasing scrutiny from the SEC and the agency’s ongoing trend of “regulation by enforcement” as opposed to providing firm regulatory clarity for these companies. at the beginning of his activities in crypto.
In his statement on the bill, Senator Hagerty stated that: “The current lack of regulatory clarity for digital assets presents entrepreneurs and businesses with a choice: navigate significant regulatory ambiguity in the US or move overseas to markets with clear digital asset regulations assets.
“Unfortunately, this uncertainty discourages investment and job creation here in America and threatens the United States’ leadership in this transformative technology at such a crucial time.” This legislation is an important step toward providing much-needed security to digital asset intermediaries and removing the barriers to entry that currently hinder the growth and liquidity of the US cryptocurrency market.”
Compliance with the law in America
