EthereumMax Investors Win State Lawsuits Over Pump and Dump
California federal judge Michael Fitzgerald granted partial class-action status to EthereumMax investors, allowing state-level suits in New York, California, Florida and New Jersey while blocking a nationwide claim. Plaintiffs allege that EthereumMax promoters—including Kim Kardashian, Floyd Mayweather and Paul Pierce—pumped and dumped the EMAX token during its 2021 launch, inflating prices over 116,000% before crashing. Defendants also include EMAX Holdings, co-founder Giovanni Perone and spokesperson Jona Rechnitz. The suit follows an initial dismissal in December 2022 and a mid-2023 refiling. This approval underscores growing regulatory scrutiny of celebrity crypto endorsements. Traders should note the risks of celebrity-backed pump and dump schemes and conduct thorough due diligence.
Bearish
EthereumMax faces reputational damage from the partial class-action approval and intensified regulatory scrutiny. Legal uncertainties and allegations of a celebrity-driven pump and dump scheme are likely to erode trader confidence. In the short term, the news could trigger sell-offs as investors reassess risks. Long term, ongoing litigation may deter speculative inflows and limit price recovery. Historical precedents show that major lawsuits typically result in sustained price weakness, making this development overall bearish for EthereumMax.