Attorneys say that Cristiano Ronaldo knowingly misled investors into purchasing non-fungible tokens, a type of digital asset that can be authenticated and re-sold but is often subject to extreme volatility.
A $1 billion class action lawsuit accuses soccer superstar Cristiano Ronaldo of misleading investors by promoting non-fungible tokens on Binance, the world’s largest cryptocurrency exchange.
According to CNN, the lawsuit was filed earlier this week in U.S. District in Florida. In their complaint, members of the class claim that Ronaldo “promoted, assisted in, and/or actively participated in the offer and sale of unregistered securities in coordination with Binance,” including the sale of so-called non-fungible tokens, or NFTs.
This purported misrepresentation led to immense losses for investors who had purchased Ronald’s NFTs, which bore his likeness.
CNN notes that, in November of 2022, Ronaldo partnered with Binance to sell unique non-fungible tokens depicting “an iconic Ronaldo moment immortalized in the form of a digital statute [sic].”
Non-fungible tokens, adds CNN, assist in the authentication of certain digital assets. They can be verified, and are sometimes traded using blockchain technologies.
However, the lawsuit asserts that Ronaldo made “deceptive statements” when he “allowed his name and likeness to be used in connection with Binance’s deceptive statements in promotions of its product.”
Ronaldo also allegedly refused to disclosed “the form or amount of his compensation by Binance,” required under U.S. law, while knowing that Binance’s NFT advertisements “targeted consumers unfamiliar with crypto.”
Cristiano Ronaldo in 2021. Image via Flickr/user:karsten stalpaert. (CCA-BY-2.0). (source:https://www.flickr.com/photos/185024660@N03/51197509648).
The B.B.C. observes that the U.S. Securities and Exchange Commission requires that celebrities “disclose to the public from whom and how much [they] are getting paid to promote investment in securities.”
“When celebrities endorse investment opportunities, including crypto-asset securities, investors should be careful to research if the investments are right for them, and they should know why celebrities are making those endorsements,” S.E.C. Chair Gary Gensler said in an earlier, unrelated statement.
The lawsuit suggests that, while Ronaldo bears some liability for his promotion of unregulated and volatile NFTs, Binance intentionally partnered with high-profile celebrities to profit off less-informed investors.
“Evidence now reveals that Binance’s fraud was only able to reach such heights through the offer and sale of unregistered securities, with the willing help and assistance of some of the wealthiest, powerful and recognized organizations and celebrities across the globe—just like Defendant Ronaldo,” the class action says.
In the complaint, attorneys note that the long-term results of the Ronaldo-Binance partnership were “incredibly successful.” The lawsuit notes that, during and after the NFT promotions, internet search engines registered a 500% increase in online searches for the keyword “Binance.”
Ronaldo’s non-fungible tokens, meanwhile, were sold out within a week of their release, with sales prices ranging between the equivalent of $77 and the equivalent of $10,000.
Sources
Cristiano Ronaldo faces $1 billion class-action lawsuit for endorsing worthless NFTs
Cristiano Ronaldo faces $1bn lawsuit over Binance ads
Cristiano Ronaldo faces a $1 billion class-action lawsuit after promoting Binance NFTs
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