Cristiano Ronaldo faces $1bln lawsuit in US over Binance NFT

by Jonathan Adams
Binance

In November 2022, Binance announced its first “CR7” collection of NFTs in partnership with Ronaldo, which the footballer said would reward fans “for all the years of support”

Football star Cristiano Ronaldo is facing a class action lawsuit in the US over his promotion of Binance, the biggest crypto currency exchange in the world.

The plaintiffs claim his recommendation led them to make loss-making investments.

They are seeking damages of “a sum exceeding” $1bln.

In November 2022, Binance announced its first “CR7” collection of NFTs in partnership with Ronaldo, which the footballer said would reward fans “for all the years of support”.

Non-fungible tokens are virtual assets that can be bought and sold, but which have no real-world form of their own. Generally, they are used to mark ownership of something, like a picture or video online.

“CR7” refers to Ronaldo’s initials and shirt number, and is used as branding in an array of products, from footwear to fragrances, that have helped make him one of the wealthiest athletes in the world.

In a social media video announcing the partnership, Ronaldo told would-be investors “we are going to change the NFT game and take football to the next level”.

The cheapest NFT from the collection was priced at $77 when it went on sale in November 2022 – but one year later, it was priced at nearly $1.

The claimants allege that Ronaldo’s promotion of Binance resulted in a “500 per cent increase in searches” for the crypto exchange, which is registered in the Cayman Islands.

They also say it led people to use the company to invest in what they call “unregistered securities” – like Binance’s BNB crypto currency.

According to the US SEC, these assets can be considered securities – and so celebrities endorsing them must follow US law.

SEC chair Gary Gensler earlier said celebrities must “disclose to the public from whom and how much you are getting paid to promote investment in securities”.

When celebrities recommend 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, Gensler added.

The claimants allege Ronaldo should have revealed how much he was being paid, but did not.

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