Celebrity coin JENNER surged more than 90% on Thursday, even as a securities lawsuit was filed against Caitlyn Jenner.
Victims accuse the Olympic gold medalist of misleading investors in the token offering.
Fraud allegations against Caitlyn Jenner spark interest in JENNER
Two international investors, Naeem Azad of the United Kingdom and Mihai Caluseru of Romania, filed a lawsuit in federal court in California. They claim cumulative losses of more than $50,000. Part of the allegations include Jenner using her celebrity status to lure unwary investors to the cryptocurrency project without full transparency or record-keeping.
Launched on Solana and Ethereum blockchains, JENNER aimed to capitalize on Caitlyn’s fame and take advantage of the growing trend of celebrity coins. The token debuted on Solana Coin Launchpad, Pump.Fun.
According to court documentsJENNER saw trading volume climb to more than $250 million in its early days, attracting around 20,000 investors worldwide. However, the lawsuit claims this early success was short-lived. He notes that after reaching record levels, JENNER lost 99% of its peak value following allegations of insider trading and mismanagement of the project.
The plaintiffs allege that Jenner, her manager Sophia Hutchins, and alleged crypto advisor Sahil Arora violated securities laws.
“These are tokens without proper registration or transparency,” the document states.
Arora, a character believed to be linked to previous financial scamsreportedly abandoned a substantial portion of its holdings after the token’s initial rise. This triggered a massive sell-off which led to the collapse of the token.
In response, the project was relaunched on Ethereum. According to the lawsuit, this further harmed holders of the original Solana-based token.
The lawsuit highlights various alleged misrepresentations, including broken promises to list JENNER on major exchanges. Others include broken commitments for token buybacks and a 3% transaction tax added without informing investors.
Additionally, Jenner reportedly pledged to make a donation part of the project’s revenue to Donald Trump’s presidential campaign in 2024. It is also said that this promise was not kept.
By failing to disclose details such as insider ownership stakes, purchase prices of initial acquisitions and associated financial risks, the plaintiffs claim Jenner misled investors about the viability of JENNER as an investment.
Despite this report, data on DexScreener watch that JENNER meme coin is up 90% since Thursday’s session opened. At the time of writing, it is trading at $0.0007250.
A broader trend of celebrity crypto controversies
The law firm representing Azad and Caluseru, Fitzgerald Monroe Flynn PC, notes that JENNER’s case reflects an ongoing trend of celebrity cryptocurrency endorsements gone wrong.
“This case is part of a growing trend in which celebrities exploit their public image to launch coins, but when the projects fail, investors suffer the financial consequences.” said attorney Peter Grazul, who represents the plaintiffs.
According to Grazul, cases like these highlight the need for stronger regulatory oversight to protect investors.
JENNER’s launch gained traction as Jenner actively promoted the piece on social media. She highlighted its novelty and potential as a celebrity-backed coin. However, according to the lawsuit, Jenner gradually distanced herself from the project.
Internal allegations have even surfacedsuggesting that his early gains from JENNER’s price surge may constitute insider trading. Channel sleuths began digging into transaction records, alleging that Jenner and her team may have benefited from premeditated price manipulation.
The plaintiffs argue that Jenner’s apparent abandonment of the project shows a disregard for investors’ financial losses.
Meanwhile, celebrity involvement in cryptocurrency has become a double-edged sword. Public figures gradually lend credibility to projects, but often raise red flags about ethical conduct and transparency.
JENNER isn’t Caitlyn’s only venture in crypto. She also launched the MEDAL Tokentaking inspiration from her 1976 Olympic gold medal.
Although MEDAL is not named in the current lawsuit, its association with Caitlyn and the JENNER controversy could influence investor confidence in the project. This could draw attention from regulators to its other crypto initiatives.
Disclaimer
In accordance with the Trust Project guidelines, BeInCrypto is committed to providing unbiased and transparent reporting. This news article aims to provide accurate and current information. Readers are, however, advised to independently verify the facts and seek professional advice before making any decision based on this content. Please note that our Terms and conditions, Privacy PolicyAnd Disclaimer have been updated.