NFTs
Ronaldo targeted in $1 billion class action lawsuit for endorsing Binance NFTs
Portuguese soccer star Cristiano Ronaldo is facing a class-action lawsuit seeking at least $1 billion in damages for his role in promoting cryptocurrency-related “non-fungible tokens,” or NFTs, issued by the beleaguered cryptocurrency exchange Binance to millions of its fans.
The lawsuit, filed in federal court for the Southern District of Florida on Monday, alleges that Ronaldo’s promotion of Binance was “deceptive and illegal.” Binance’s partnership with prominent figures like Ronaldo, the plaintiffs claim, led them into expensive and unsafe investments.
As part of the marketing partnership, Ronaldo encouraged millions of his fans and supporters to invest in Binance, even though many of them were unfamiliar with cryptocurrencies or the platform, the lawsuit alleges. As a result of his endorsement, his fans were left with the impression that the investments were safe – as was the case with the plaintiffs in the lawsuit, who purchased products sold on Binance after seeing Ronaldo’s endorsement, he claims.
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Ultimately, they lost money, the lawsuit states.
“Evidence now reveals that the Binance fraud was only able to reach such levels through the offering and sale of unregistered securities, with the help and voluntary assistance of some of the richest, most powerful and recognized organizations and celebrities across the world – as well as Defendant Ronaldo,” the lawsuit says.
Representatives for Ronaldo declined to comment on Thursday. Binance, the world’s largest cryptocurrency exchange, did not immediately return requests for a statement from the Associated Press.
Ronaldo is not the first celebrity to be sued for his involvement in the crypto world. Last year, NFL quarterback Tom Brady, supermodel Gisele Bundchen and comedian Larry David were among a star-studded list. accused of defrauding investors who lost money in the cryptocurrency exchange collapse.
The stars appeared in a Super Bowl ad and other FTX promotions. The suit argued that the celebrities’ status made them culpable for promoting FTX’s failed business model.
Ronaldo NFT Collection
Ronaldo launched his inaugural “CR7” NFT collection with Binance in November last year, ahead of the 2022 World Cup. The NFTs – which had starting prices ranging from the equivalent of around US$77 to US$10,000 – featured seven animated statues depicting Ronaldo at iconic moments in his life, from bicycle kick goals to his childhood in Portugal.
Monday’s lawsuit says Ronaldo’s Binance partnership promotional efforts were “incredibly successful” – claiming a 500% increase in online searches using the keyword “Binance” following the announcement of the football star’s NFTs . The collection’s premium-tier NFTs sold out within the first week, the lawsuit states.
The lawsuit also alleges that Ronaldo should have disclosed how much Binance paid him for the partnership. The US Securities and Exchange Commission previously noted that federal law requires celebrities to publicly disclose how much they are being paid to promote securities, including crypto assets.
The Brief NFT Boom
NFTs are ordinary digital images with a version number attached that have been added to a cryptocurrency blockchain, a process designed to make them “one-of-a-kind” collectibles. NFTs enjoyed a brief boom, but their value has since collapsed as the crypto industry has been marred by scandals and market meltdowns.
Over the summer, Binance was accused of operating as an unregistered securities exchange and violating a number of US securities laws in a lawsuit brought by regulators. The crypto exchange last week agreed to pay a agreement worth approximately US$4 billion and its founder, Changpeng Zhao, resigned as CEO and pleaded guilty to a crime related to his failure to prevent money laundering on the platform.
Ronaldo is one of the most recognized and richest athletes in the world. He leads the national team of his country, Portugal, and has played for Spanish team Real Madrid, Italian club Juventus and Manchester United in England. He now plays for Saudi Arabian professional team Al Nassr.
Ronaldo continued to promote Binance on his official website and social media platforms. More recently, on X (the platform formerly known as Twitter), Ronaldo reposted a Binance video and wrote that he was “preparing something” with the cryptocurrency exchange on Tuesday.