Think of Kim Kardashian

This week an unusual word sequence came to my mind: poor Kim Kardashian. At the risk of losing her before I started, I would like to ask her to waste a thought of a woman who is mainly famous to be famous (and to be rich).

It turned out that Kardashian has agreed with the US stock exchange supervisory authority SEC this week about the accusation of "illegal advertising" for a "crypto value paper" with a fine of $ 1.26 million or about $ 0.07 percent of its expulsed net assets of $ 1.8 billion. (Cue the sound of tiny violins.)

But it is not the amount of the fine that I believe that Kardashian is worth a second thought, nor the suggestion that the indictment could affect her ambitions to become a lawyer. It is the case that the violation that is accused of is negligible if you compare it with the extent of crimes, dishonesty, exploitation and open fraud, which is largely impossible every day in the world of cryptography.

The alleged violation goes back to June 2021 when the reality star and business mogul had an Instagram story to her followers-she had more than 200 million at the time-posted and asked: "Is she on crypto ???" She continued: "This is not a financial advice, but tells me what my friends just told me about the Ethereum Max-token!" Then there was a few phrases about how Ethereum Max "returned" the Community, and then a number of hashtags, including "#ad" at the very end.

Given the fact that she said it was an advertisement, what exactly did Kardashian supposedly do wrong? It depends on a matter of form: if you are paid to support or apply for a securities-what the SEC now sees as crypto tokens-you must explicitly disclose this together with the amount you are paid (in this case $ 250,000).

I don't want to defend Kardashian's sale of a worthless crypto token-I believe that all this advertising is unethical, and the fact that it is so rich makes it all the less forgiving. But an influencer cannot give crypto the kind of legitimacy that someone who is not known to make a living with the promotion of garbage on social media.

Someone like Matt Damon, for example. He appeared in an advertisement for Crypto.com during this year's US Super Bowl and suggested that the purchase of crypto and NFTS should be considered "brave". If you get infected by it, you will have suffered heavily: the value of the cryptoma market has halved about it since then, NFTS have broken into even more spectacular. In contrast to Crypto.com, Ethereum Max is hardly a big time player: At the time of writing this article, it was 4th 2nd26 in the ranking of the more than 21,000 tokens.

And what about the insiders behind the many crypto projects that collapsed this year? People like Alex Mashinsky, founder of Celsius, the crypto loan company, who went bankrupt at the beginning of this year and his customers 4.7 billion

John Reed Stark, a lawyer who has built up and managed the SEC Internet enforcement agency for eleven years, says that the authority has rightly punished Kardashian, but that what it did wrong was completely "irrelevant".

"As important as this is because it is a strong message about the promotion of crypto," says strongly to me, "the [Actions of] Kim Kardashian pale compared to the wasp nest.

I am not even sure whether the Kardashian comparison sends a particularly strong message because the indictment is a technical error. And while the video of the second chairman Gary Gensler, in which people are asked to treat crypto notes with caution, may be funny, it only focuses on investments that are advertised by celebrities and influencers. Regulatory authorities such as the SEC have slept at the wheel in terms of crypto and not almost enough to protect consumers and regulate cryptoplate forms of all kinds.

I don't expect you to feel Kardashian. But I hope you might think that it was not punished for the fact that she was waving a worthless crypto token to the masses-which can be made completely legally-but for not adding a little more small print.

The regulatory authorities should pay their attention to the larger fish. It is good and good that you keep pace with the Kardashians, but you have to make sure that you keep pace with the rest of the lawless crypto country.

jemima.kelly@ft.com