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Mayweather, DJ Khaled Fined by SEC for Undisclosed Payments for Crypto Promotion

The increase in celebrity involvement in cryptocurrency could possibly see a slowdown given recent legal actions by the Securities and Exchanges Commission (SEC). According to a recent SEC press release, previous celebrity promotion of cryptocurrency investments by Floyd Mayweather and DJ Khaled were allegedly found to be in violation of part of the US securities act prohibiting promotion of securities without disclosing the receipt of compensation for said promotion:

SEC chairman  Jay Clayton has often stated that while  Bitcoin is not considered a security, initial coin offerings (ICO) are and as such are subject to SEC laws.

 

This, unfortunately, means that a large number of cryptocurrencies that have used ICOs to launch could very well be out of compliance with the SEC.  The good news is that there are many in the space who have partnered with the SEC for some time to ensure compliance. For instance, Coinbase has an extensive rubric for deciding which digital assets to deal with which includes ensuring compliance with US law.

Now when it comes to celebrity endorsements, it looks like you still have to be a disciplined and informed investor no matter who is doing the selling. It may be a new way of dealing with money but it still comes with many of the same old pitfalls you’ll need to lookout for.

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About Beres Marrast

Christ Follower, Full-time husband, Physical Therapist and part-time tech enthusiast for the fun of it.

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