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Another internet influencer fails to box clever.

BIScom Subsection: 
Author: 
Editorial Staff

Maybe Floyd Mayweather has been hit in the head too many times. The USA's Securities and Exchange Commission describes him as "a well-known professional boxer." The "well-known" bit is perhaps an understatement: his social media "reach" in 2017 was huge: 21 million "followers" on Instagram, 7.8m on Twitter and 13.4 m on Facebook. So when he said "hey, this is a good idea," it carried far more weight than his slight frame. When people talk about "fame" and "fortune," they might have been talking about Mayweather's return to the ring for one fight only but he used that fame to be paid for boosting crypto-currency ICOs.

Floyd Mayweather is a former boxer who has had periodic come-backs, the most recent of which was in 2017 for a single bout which received an extraordinary amount of publicity for someone who had been out of contention for some two years. In September 2017, he was lined up for a contest against Conor McGregor. The media coverage was huge. If his star had burned a little less brightly in the previous two years, it dazzled for three months or so. The publicity for the fight was, in many cases, marketing led because the fight was to be shown on Pay-to-View (actually known as pay-per-view) and it was estimated at the time that Mayweather's earnings taking into account all revenue sources would be in the region of some USD300 million. That's a great amount of money, even if one has to be punched in the face a few times as a precondition of receiving it.

But it wasn't enough. As the publicity ramped up, the 41 year old Mayweather, who lives in Nevada where there is no state personal income tax although he remains liable for federal income tax, entered into agreements to promote three ICOs on his social media accounts. For doing so, he was paid about USD300,000.

Like DJ Khaled he boosted Centra Tech, Inc. In Mayweather's case the boost was perhaps even more blatent: "Centra's (CTR) ICO starts in a few hours. Get yours before they sell our, I got mine...." in his second of two posts. Centra paid him USD100,000 for two posts. He recorded and posted a video three months later, apparently using a so-called "Centra Wallet" and a "Centra Card" app on his iPhone to make purchases, a video which Centra re-broadcast under the headline "Centra Floyd Mayweather Jr Spending Bitcoin with Centra Card and Centra Wallet. That does not, necessarily, relate to the ICO but the first two announcements did and Mayweather did not disclose that his promotion was paid for.

He also promoted two other ICOs. In July 2017, he wrote, or allowed others to write, on his social media accounts "floydmayweather Champion Predictions: I’m gonna make a $hit t$on of
money on August 26th. I’m gonna make a $hit t$n of money on August 2nd on the Stox.com ICO. " In its announcement of its action against Mayweather, the SEC elected to redact the name of the ICO for reasons that have not been made public. The SEC has been similarly reticent over Mayweather's promo "You can call me Floyd Crypto Mayweather from now on. [. . .] #ICO starts tomorrow! Smart Contracts for sports?!" It was for Hubii.network.

Stox, reportedly, raised USD33 million via ethereum in two days.

The SEC notes that each of Mayweather's promotions took place after the Commission issued a warning that ICOs "may be" dealings in securities.

As usual, the SEC has done a deal in which its target does not admit or deny the allegations, even though they are matters of public record. He has given an undertaking that, for a period of three years, he will not receive or agree to receive any compensation for promoting any security. In addition he will pay a civil penalty (not, as some media has reported, a fine) of USD300,000 plus a surrender of the sum USD300,000 being the proceeds of his actions plus pre-judgment interest of USD14,775.67. This settles a civil action. No criminal penalty attaches.

Further reading: https://www.sec.gov/litigation...

 


 

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