Famous professional football star Cristiano Ronaldo has been embroiled in a proposed class action lawsuit as plaintiffs claim that his promotion of troubled crypto exchange Binance led to significant losses for investors. The lawsuit, filed November 27 in a United States district court in Florida, alleges that Ronaldo actively participated in the promotion of unregistered securities in collaboration with Binance.
Ronaldo on regulators’ radar with NFT promotions on crypto exchange
In a filing that sent shockwaves through the crypto community, Ronaldo is accused of encouraging, assisting and actively participating in the offering and sale of unregistered securities linked to Binance. The legal action stems from a multi-year partnership established between Binance and Ronaldo in mid-2022, in which the football star backed a series of fungible tokens (NFTs) and several collectibles were directly linked to the embattled exchange.
Cooking something up with @binance https://t.co/FMAP5GAdxE
— Cristiano Ronaldo (@Cristiano) November 28, 2023
Users interested in Ronaldo’s NFTs are allegedly more likely to use Binance for other investment purposes, including trading unregistered securities like Binance’s BNB and participating in crypto yield programs, according to the complaint. The lawsuit argues that Ronaldo’s promotions played a significant role in encouraging his large social media following to invest in the Binance platform.
Ronaldo’s SEC violations allegations
The class action lawsuit alleges that given Ronaldo’s investment experience and significant resources, Binance should have been aware of his involvement in selling unregistered crypto securities. The complaint highlights that he failed to disclose payments received to promote cryptocurrencies, a requirement highlighted by the U.S. Securities and Exchange Commission (SEC) in its guidance on celebrities endorsing crypto assets.
The plaintiffs – Michael Sizemore, Mikey Vongdara and Gordon Lewis – are seeking damages and funds to cover legal fees as they seek justice against both Ronaldo and Binance. The lawsuit claims that Ronaldo’s NFT sales significantly contributed to the exchange’s popularity, with a significant increase in searches for Binance following the initial sale.
What happened?
As we at Kriptokoin.com reported, legal challenges escalate for Binance, with its founder Changpeng “CZ” Zhao being found guilty and facing a hefty compensation payment, while Ronaldo’s involvement adds a new dimension to the ongoing saga. The SEC’s review of Binance for alleged violations, including the sale of unregistered securities, further underscores turbulent times for the once-dominant crypto exchange. Time will tell what will happen in the coming period and how Ronaldo will react to the trial.
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