Celebrities Linked to Crypto Pump and Dump Scams
Kylian Mbappé's X account was hacked and to promote a crypto scam. l Credit: Florencia Tan Jun/Getty Images
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?
A crypto pump-and-dump scam 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.
This practice is prevalent in the cryptocurrency industry. Fraudsters acquire a significant amount of a digital asset, hype its potential through aggressive marketing, and drive 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.
Mbappé’s X Account Hacked
Soccer superstar Kylian Mbappé fell victim to a sophisticated phishing attack on Aug. 29, 2024. Hackers compromised his official X account , using his massive following to promote a fraudulent token called MBAPPE.
The scam, a familiar tactic used to target celebrities, quickly gained traction. The MBAPPE token experienced a meteoric rise in value, reaching a multi-million dollar market capitalization before ultimately collapsing to zero.
While a few opportunistic investors managed to profit from the scam, the vast majority of unsuspecting victims suffered significant financial losses. One investor, as highlighted by Lookonchain , lost over $1 million in a single transaction.
The hackers behind the attack exploited Mbappé’s verified account to lure his followers into investing in the fraudulent token. They successfully siphoned over $600,000 in assets before the account was recovered.
Messi & Ronaldinho Promote $WATER
On Monday, July 8, 2024, Lionel Messi’s Instagram account unexpectedly posted a story appearing to promote the Solana memecoin WATER. The official Instagram account for the WATER memecoin also shared this story. It featured an image of the Argentinian star with the memecoin’s logo visible over his shoulder.
However, a few hours after posting Messi’s picture, Water’s page on Instagram posted a picture of Brazilian football legend Ronaldinho, claiming his support for the memecoin as well.
Following Messi’s Instagram post, WATER’s value surged over 55%, though it later lost half of those gains, according to CoinGecko . So far, no confirmation arrived from Messi or his team, and the crypto community wonders whether this is another scam activity or whether Messi and Ronaldinho accepted to promote this memecoin.
The on-chain tracker Bubblemaps issued a warning on X, urging followers to devalue WATER. Despite concerns about supply concentration, investors chose to buy the token following Messi’s post.
Messi Also Endorses $TIME
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.
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.
The Most Recent Cases
Metallica and American actress Sydney Sweeney’s X accounts were hacked, and now-deleted posts were used to promote crypto token named $METAL and $SWEENEY which brought to losses of $10 million and $13 million, respectively.
Most recently, the US dancer Jason Derulo’s cryptocurrency – $JASON – faced allegations of being a pump-and-dump scheme following a sharp rise-and-fall in price. It increased by 6,000% on June 23, 2024. But it dropped the day after. $JASON then reached a market capitalization of $5 million.
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 |
| 50 Cent | $GUNIT | $300,000,000 |
| Metallica | $METAL | $10,000,000 |
| Sidney Sweeney | $SWEENEY | $13,000,000 |
| Jason Derulo | $JASON | $5,000,000 |
| Lionel Messi-Ronaldinho | $WATER | $138,900,000 |
| Lionel Messi | $TIME | $22,200,000 |
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