Cristiano Ronaldo Sued For Promoting Binance
Pro-soccer star Cristiano Ronaldo is now entangled in a proposed class-action lawsuit, with plaintiffs claiming they suffered losses due to his promotion of the crypto exchange giant, Binance. The lawsuit, filed on Nov. 27 in a United States district court in Florida, asserts that Ronaldo actively participated in offering and selling unregistered securities in coordination with Binance.
The Binance-Ronaldo Partnership
In mid-2022, Binance announced a multiyear partnership with Ronaldo to promote a series of his nonfungible tokens (NFTs). At least three collections of Ronaldo’s NFTs were tied to Binance, aiming to capitalize on the soccer star’s immense popularity and influence. The complaint alleges that users who signed up for Ronaldo’s NFTs were more likely to use Binance for other purposes, including investing in what they claim are unregistered securities.
With a staggering 850 million followers across various social media platforms, Ronaldo played a pivotal role in boosting Binance’s popularity. The lawsuit contends that Ronaldo’s NFT sales were “incredibly successful,” leading to a 500% increase in searches for Binance in the week following the initial sale. The plaintiffs argue that Ronaldo knowingly or should have known about Binance selling unregistered crypto securities, given his investment experience and vast resources.
Failure to Disclose: SEC Guidance Ignored
The lawsuit points to U.S. Securities and Exchange Commission (SEC) guidance that warns celebrities about the necessity of disclosing payments received for promoting cryptocurrencies. The complaint claims that Ronaldo failed to adhere to this guidance, potentially exposing him to legal consequences.
“Ronaldo’s promotions solicited or assisted Binance in soliciting investments in unregistered securities by encouraging his millions of followers, fans, and supporters to invest with the Binance platform.”
As Binance and its founder Changpeng “CZ” Zhao face their own legal challenges, Ronaldo becomes a prominent figure in the broader legal saga. Binance recently pleaded guilty and agreed to a $4.3 billion settlement with the U.S. government for Anti-Money Laundering violations and operating an unregistered money-transmitting business. With Zhao stepping down as CEO, facing potential prison time, and Binance undergoing compliance monitoring, the lawsuit adds another layer of complexity to the legal landscape surrounding both the exchange and the soccer star.
In the class-action lawsuit, plaintiffs Michael Sizemore, Mikey Vongdara, and Gordon Lewis seek damages and funds to cover legal fees, alleging that Ronaldo’s promotions contributed to Binance’s sale of unregistered securities. The case unfolds against the backdrop of increased scrutiny of celebrities endorsing cryptocurrencies and the regulatory challenges faced by major players in the crypto industry.