n the world of cryptocurrency, even superstars like Cristiano Ronaldo are not immune to controversy. The renowned soccer player is currently facing a proposed class-action lawsuit for his involvement in promoting the Binance crypto exchange. This legal battle raises questions about the responsibility of celebrities when endorsing financial products and the potential risks associated with investing in unregistered securities.
The Lawsuit Against Cristiano Ronaldo
The lawsuit, filed in a US district court in Florida on November 27, accuses Cristiano Ronaldo of playing a role in the sale of unregistered securities in collaboration with Binance. It claims that Ronaldo's promotion of his own non-fungible tokens (NFTs), which were tied to Binance, encouraged users to engage with the exchange for investment purposes. The plaintiffs argue that these actions constituted the sale of unregistered securities, including Binance's BNB token and its crypto yield programs.
The lawsuit highlights Ronaldo's massive social media following of 850 million users and suggests that his endorsement significantly contributed to Binance's popularity. It alleges that Ronaldo's promotions solicited investments in unregistered securities by encouraging his followers to invest with the Binance platform. The plaintiffs contend that Ronaldo should have been aware of Binance's sale of unregistered crypto securities, given his investment experience and resources.
Binance's Legal Challenges
Binance has been facing legal challenges, including a recent settlement with the US government. The exchange and its founder, Changpeng Zhao (CZ), pleaded guilty and agreed to pay a $4.3 billion settlement for violating Anti-Money Laundering laws and operating an unregistered money-transmitting business. CZ has stepped down as CEO and may face up to 18 months in prison. Binance has also committed to compliance monitoring by the US Department of Justice and the Department of the Treasury for up to five years.
SEC Investigation
Despite the settlement, Binance is still under investigation by the Securities and Exchange Commission (SEC). The SEC is probing Binance and its American counterpart, Binance.US, for their alleged involvement in the sale of unregistered securities. The agency is particularly interested in examining Binance.US's control over customer assets and its structure resembling that of FTX. The outcome of this investigation could have significant implications for Binance's future operations.
