- Football star Cristiano Ronaldo faces a $1 billion lawsuit for allegedly causing investor losses through his endorsement of Binance.
- The class action suit claims Ronaldo’s promotion led to a “500% increase in searches” for Binance, triggering investments in what the plaintiffs term “unregistered securities.”
- As the legal battle unfolds, Ronaldo and Binance hint at future collaborations, adding further complexity.
Football icon Cristiano Ronaldo finds himself entangled in a legal battle as a class action lawsuit, surpassing $1 billion, unfolds in the US. The lawsuit alleges that Ronaldo’s endorsement of Binance, the world’s largest cryptocurrency exchange, led investors to incur losses. Both Ronaldo’s management company and Binance have been approached for comments, but responses are yet to be received.
The CR7 NFT Collection
In November 2022, Binance unveiled its inaugural “CR7” collection of non-fungible tokens (NFTs) in collaboration with Ronaldo. These digital assets, representing ownership without a physical form, were introduced to reward fans for their unwavering support. Ronaldo, in a social media video, expressed the intent to revolutionize the NFT landscape and elevate football to new heights.
Alleged Financial Impact
The claimants argue that Ronaldo’s promotion led to a substantial “500% increase in searches” for Binance, a Cayman Islands-registered crypto exchange. Furthermore, they contend that individuals were driven to invest in what they term “unregistered securities,” including Binance’s BNB cryptocurrency. The US Securities and Exchange Commission (SEC) considers these assets as securities, necessitating compliance with US law for celebrities endorsing them.
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Lack of Disclosure
The lawsuit asserts that Ronaldo failed to disclose the amount he received for endorsing Binance, a requirement according to SEC Chair Gary Gensler. Gensler emphasizes that celebrities endorsing investment opportunities, especially in crypto-asset securities, should transparently disclose their compensation details. The claimants argue that Ronaldo’s omission of this crucial information violated regulatory standards.
Broader Regulatory Concerns
Nigel Green, CEO of DeVere Group, emphasizes that attributing blame solely to Ronaldo oversimplifies the issue. He suggests directing attention to global regulators who have been slow to establish clear guidelines for the evolving financial landscape. Green underscores the importance of regulatory frameworks in addressing challenges arising from celebrity endorsements in the financial sector.
Despite the ongoing legal dispute, Ronaldo and Binance hint at potential future collaborations, as indicated by a recent social media post from the footballer. Both parties, however, have remained silent in response to the BBC’s inquiries regarding the lawsuit and related matters.
Also Read: Judge Denies ex-Binance CEO’s Request to Leave US Prior to Sentencing
The Binance Legal Saga
This class action suit follows closely on the heels of the US Justice Department’s directive for Binance to pay $4.3 billion in penalties and forfeitures. The accusations against Binance include facilitating users in evading global sanctions and enabling illicit money movements. Changpeng Zhao, Binance’s CEO, resigned after admitting to money-laundering violations.
The legal challenges extend beyond the realms of football and crypto, with Major League Baseball, Formula 1, and Mercedes-Benz facing parallel class action lawsuits. These legal actions stem from their promotion of the beleaguered crypto-exchange FTX, adding another layer of complexity to the evolving intersection of sports, celebrities, and the cryptocurrency market.
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