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Football star Cristiano Ronaldo has been hit by a class action lawsuit for promoting virtual currency, demanding at least $1 billion in damages

Football star Cristiano Ronaldo has been hit by a class action lawsuit for promoting virtual currency, demanding at least $1 billion in damages

Football star Cristiano Ronaldo (Cristiano Ronaldo) has been subjected to a class action lawsuit for promoting virtual currency, and is required to pay at least US$1 billion (about 7.1 billion yuan) in damages.

A few days ago, a number of virtual currency investors filed a lawsuit in the Southern District Court of Florida in the United States, saying that Ronaldo's promotion for Binance was suspected of being "deceptive and illegal". The plaintiffs allege that Binance's partnership with high-profile figures such as Cristiano Ronaldo has led them to make costly and unsafe investments.

Football star Cristiano Ronaldo has been hit by a class action lawsuit for promoting virtual currency, demanding at least $1 billion in damages

"There is evidence that Binance's fraudulent act of issuing and selling unregistered securities has such a wide impact related to the voluntary help and assistance of some of the world's richest and most influential high-profile organizations and celebrities – such as defendant Cristiano Ronaldo," the lawsuit reads. ”

Ronaldo's partnership with Binance dates back to November last year.

Ahead of the 2022 World Cup, Ronaldo partnered with Binance to launch his first "CR7" series of non-fungible tokens (NFTs). The tokens start at $77 to $10,000, but are worth only $1 after a year.

The investor lawsuit alleges that Ronaldo's promotional efforts for the partnership with Binance were "very successful" – with a 500% increase in online searches using "Binance" as a keyword after the announcement of the soccer star's token collection. The high-grade tokens in the series sold out in the first week of release.

The lawsuit also alleges that Ronaldo's involvement caused them to lose a large amount of money on their investment, which cost them more than $1 billion. Ronaldo should disclose how much Binance paid him. The SEC previously noted that federal law requires celebrities to publicly disclose the compensation they receive for promoting securities, including cryptoassets.

NFT stands for Non-Fungible Token, which is a unique virtual currency token used to represent digital assets, which is indivisible, irreplaceable, and unique. In 2021, NFTs experienced a brief boom, but this year, their value has shrunk significantly as the virtual currency market continues to decline.

Football star Cristiano Ronaldo has been hit by a class action lawsuit for promoting virtual currency, demanding at least $1 billion in damages

According to public information, Binance is a global virtual currency exchange that provides a trading platform for more than 100 virtual currencies. As of the end of 2022, Binance has more than 120 million users worldwide and processes around $65 billion worth of transactions every day, capturing up to 70% of the market share

This summer, U.S. regulators accused Binance of operating without a license and violating a range of U.S. securities laws.

On November 21, local time, the official website of the U.S. Department of Justice announced that Binance admitted to participating in suspected money laundering, unlicensed remittances and sanctions violations, and agreed to pay a fine of 4.3 billion US dollars (about 30.7 billion yuan). Meanwhile, Binance founder and CEO Changpeng Zhao admitted that he failed to maintain an effective anti-money laundering program and has resigned as CEO.

According to court documents, Binance has admitted to prioritizing growth and profits over compliance with U.S. law. In addition, as part of the plea agreement, Binance also agreed to retain an independent compliance monitor for three years to correct and strengthen its anti-money laundering and sanctions compliance program.

On November 22, Changpeng Zhao announced his resignation on social platforms, saying that his resignation was the right move and that he would take responsibility for the mistakes he made.

Longtime Binance executive Richard Teng will succeed Changpeng Zhao as Binance's new CEO. However, Changpeng Zhao is still the majority shareholder of Binance.

At the end of 2021, against the backdrop of the sharp rise in many virtual currencies such as Bitcoin, Changpeng Zhao was once the richest man in China with a net worth of 94.1 billion US dollars (about 634.8 billion yuan), and also ranked among the top ten richest people in the world.

According to the 2023 "Hurun Global Rich List", Changpeng Zhao's current net worth is 80 billion yuan, a decrease of nearly 90%.

This week's lawsuit against Ronaldo is not the first time celebrities have been sued for promoting virtual currency.

Last year, after the explosion of the top virtual currency trading platform FTX, there was an increase in class action lawsuits against celebrity endorsements. Several Hollywood stars and sports stars, including Larry Davy and Tom Brady, are named as defendants in a class-action lawsuit against FTX.

[Source: Jiupai News Comprehensive China Securities Journal, CCTV Finance]

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