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Celebrities Linked to Crypto Pump and Dump Scams

Published 6 days ago
Giuseppe Ciccomascolo
Published 6 days ago

Key Takeaways

  • Pump-and-dump schemes are a type of fraud that can be used to manipulate the price of a cryptocurrency.
  • Fraudsters promote crypto to drive up the price, then sell off their holdings when the price peaks.
  • Celebrities often receive money to promote crypto, but this does not mean they’re good investments.

Celebrities, including actors, musicians, and sports stars, are widely involved in crypto projects – whether directly or indirectly. However, their famous faces are not always used in positive circumstances.

Many influencers and actors have found themselves in legal trouble after promoting crypto ads that turned out to be fraudulent operations. The list of those entangled in these scandals is quite extensive.

What’s A Pump-And-Dump Scam

Before looking at which celebrities faced legal issues due to their promotions of crypto pump-and-dump scams, it’s necessary to know this kind of scam.

A crypto pump and dump scheme involves artificially inflating the value of a low-capitalization asset or stock to sell at an inflated price. This fraud has evolved from telephone scams to sophisticated internet schemes, reaching many users through emails and online promotions.

In the cryptocurrency industry, this practice is prevalent. Fraudsters acquire a significant amount of a digital asset, hype its potential through aggressive marketing, and drive up its price. Once it peaks due to new investors, they sell off their holdings, causing the price to plummet and leaving new investors with significant losses.

The damage is twofold: the asset’s devaluation and financial losses for new investors. These schemes operate through forced price manipulation, initially inflating the asset’s value far beyond its worth and causing it to crash.

Despite being widespread, traders can detect these scams, and there are strategies to protect against them. Awareness and vigilance are key to defending against such fraudulent schemes.

Celebrities Involved In These Frauds

In 2017, DJ Khaled and Floyd Mayweather promoted  Centra Tech’s ICO as a groundbreaking crypto payment solution alongside boxer Manny Pacquiao. The project collapsed when the founders received fraud charges. This left many investors with significant losses and tarnished the celebrities’ reputations.

Actress Lindsay Lohan endorsed  “LohanCoin,” which surged in value only to crash shortly after, leading to accusations of a pump-and-dump scheme. Similarly, Paris Hilton promoted several ICOs, raising suspicions within the crypto community despite not all being fraudulent.

Rapper T.I. faced a lawsuit over his promotion  of the Flik ICO, which was a fraudulent scheme that misled investors. Soulja Boy’s NFT  releases and Lil Pump’s “Pump Token”  also drew skepticism for their misleading marketing and speculative nature.

Gwyneth Paltrow’s promotion of the cryptocurrency app Abra  raised questions about transparency, though the app itself wasn’t a scam. Kevin Hart’s endorsement of Lil’ Bit Cash  ended disastrously when the founders vanished post-ICO, leaving investors with worthless tokens.

Paul Pierce promoted the speculative cryptocurrency SafeMoon , which led to significant losses for many investors. Kim Kardashian received a fine  from the US Securities and Exchange Commission (SEC) for not disclosing a $250,000 payment to promote EMAX tokens on Instagram, underscoring the need for transparency.

Lana Rhoades allegedly scammed investors with her NFT project “Cryptosis ,” absconding with $1.5 million worth of Ethereum. Fraudsters also used Mike Tyson’s image without consent to promote fraudulent Bitcoin ATMs, deceiving users.

In 2021, a fake cryptocurrency called “Rock Coin ” falsely claimed endorsement by Dwayne “The Rock” Johnson, who quickly warned fans about the scam, highlighting the pervasive nature of fraud in the crypto industry.

List Of Celebrities Linked to Pump and Dumps

Celebrities Involved Coin/ICO/Projects Investors Losses
DJ Khaled, Manny Pacquiao and Floyd Mayweather Centra Tech ICO $25,000,000
Lindsay Lohan Tronix and BitTorrent $31,000,000
Paris Hilton LydianCoin ICO $100,000,000
T.I. Flik ICO $200,000
Soulja Boy NFTs $730,000
Lil Pump lilpump Not Available
Gwyneth Paltrow Abra Not Available
Kevin Hart Flik ICO $2,000,000
Paul Pierce EMAX Not Available
Kim Kardashian EMAX Not Available
Lana Rhoades Cryptosis $1,500,000
Mike Tyson Bitcoin ATM Not Available
Dwayne “The Rock” Johnson Rock Coin Not Available
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