Ben.eth, a previously little-known personality in the cryptocurrency community, has come under the spotlight following the launch of at least three memecoins in recent weeks. Ben.eth has seen his Twitter following grow nearly five-fold in May, and pre-sales of these memecoins, which require Ether (ETH) to be sent directly to the creator himself, have allowed him to gather thousands of ETH. Ben.eth’s wallet currently holds 10,946 ETH, equivalent to $20.8 million.
Crypto Lawyers Weigh In on the Matter
Crypto lawyers suggest that Ben.eth’s actions could face the wrath of regulators and disgruntled investors alike. Michael Kanovitz, a partner at Loevy & Loevy, has said that the Psyop launch “is a classic example of the concerns the SEC has identified in actions like those against Kim Kardashian and Paul Pierce.” Kanovitz recently sent a profanity-laden letter via NFT to Ben.eth threatening a class-action suit against him, alleging that he “used a manipulative launch strategy” in the PSYOP presale. Kanovitz alleged that Ben promised Psyop’s returns on investment would be “several fold or greater” and claimed he “coordinated with other influencers to spread misinformation” and potentially manipulated the token’s price.
Pointing to BEN and LOYAL, Kanovitz said he is “continuing to gather evidence” on the alleged scheme. In comments to Cointelegraph, Michael Bacina, a lawyer and partner at Piper Alderman, said that the legal trouble Ben could find himself in depends on if the sales are investigated and what US regulator carries out that investigation.
Possible Legal Consequences for Ben.eth
The Securities and Exchange Commission (SEC) might believe the tokens are investment contracts and could consider them unregistered securities, which could see Ben face possible fines and penalties. However, it all depends on whether or not the sales are investigated and what US regulator carries out that investigation.
Other Influencers Attempt to Capture Memecoin Magic
Meanwhile, other influencers have attempted to capture some of the recent memecoin magic, asking followers to send ETH for essentially “nothing.” The wallet address “yougetnothing.eth” currently shows a balance of 411 ETH worth $780,000 and has close to 4,000 transactions over the last 13 hours, according to Etherscan.
American socialite Kim Kardashian was previously fined $1.26 million for her involvement in the promotion of EthereumMax (EMAX), and NBA player Paul Pierce made a similar-sized settlement with the regulator.
Ben.eth’s most recent token launch, LOYAL, is supposedly for an in-development decentralized exchange (DEX) and “memecoin launchpad” named PsyDex that will be a competitor to Uniswap, according to collaborator Ben Armstrong.
In summary, Ben.eth, the pseudo-anonymous memecoin creator behind at least three controversial token launches in recent weeks, could fall under the crosshair of United States regulators. The legal trouble that Ben could find himself in depends on if the sales are investigated and what US regulator carries out that investigation.