Cristiano Ronaldo, one of the most famous sportsmen in the world, faces a jaw-dropping $1billion class-action lawsuit in the United States, in relation to his association and promotional work, for Cryptocurrency giant Binance.

Allegations cited against the former Manchester United and Real Madrid striker, centre around losses and damages suffered by investors, following his collaboration in launching the CR7 range of non-fungible tokens (NFTs), with the largest crypto exchange in the world.

CR7 is used as branding in a range of products, from footwear to fragrances and refers to Ronaldo’s initials and shirt number, and have contributed significantly in making the 37-year-old one of football’s wealthiest ever players.

After leaving Manchester United for the second time late last year, Ronaldo became the catalyst for high-profile players to move to the Saudi Arabian Pro League, when he joined Al-Nassr.

His promotion of unregistered securities, and failure to disclose his financial gains had prompted a lot of controversy, and highlighted regulatory gaps.

The lawsuit, which was filed in the United States District Court, Southern District of Florida in Miami, refers to NFT’s dating back to November 2022.

Binance hit with multi-billion demand

The latest action follows just a week on from Binance being instructed to pay a staggering $4.3bn in penalties and forfeitures, by the US Justice Department. They were accused of assisting its users to bypass sanctions all over the world, and additionally of enabling criminals and terrorists to move money around too easily.

Astonishing fall

The actual wording in the lawsuit alleges that Ronaldo: “promoted, assisted in, and/or actively participated in the offer and sale of unregistered securities in coordination with Binance”.

The plaintiffs claim his endorsement led them to make loss-making investments. In an incredible fall the cheapest tokens went on sale for $77 a year ago, but right now are worth just $1.

Confident promise

NFT’s are nothing more than virtual assets which can be bought and sold, but in reality only have a digital existence. In an early social media video, the Portuguese superstar announced his partnership with Binance  and told would-be investors “we are going to change the NFT game and take football to the next level”.

The claimants allege that with Ronaldo’s influence, there was a “500% increase in searches” for the Cayman Islands registered exchange. They also strongly believe that it led people to use the firm to invest in what are essentially “unregistered securities”.

Responsibility for disclosure

When Celebrities endorse investment opportunities, including crypto-asset securities, they should reveal what their financial rewards for doing so amount to and the claim is that Ronaldo did not.

The chair of the US Securities and Exchanges Commission (SEC), Gary Gensler, has been very clear when saying previously: “Celebrities must disclose to the public from whom and how much you are getting paid to promote investment in securities”.

CEO resigns

Only last week, Binance announced that its chief executive, Changpeng Zhao, had resigned having admitted money-laundering violations. He had become one of the most influential figures in the world of cryptocurrency.

A spokesperson for the Justice Department said the company had enabled nearly $900 million in transactions between US and Iranian users, and facilitated millions of dollars in transactions between US users and users in Syria, and in the Russian occupied Ukrainian regions of Crimea, Donetsk and Luhansk.

Undoubtedly big shock for player

Even a man of Cristiano Ronaldo’s vast fortune will have been rocked by these developments and will no doubt have been urgently seeking some answers himself, as well as expert legal advice and representation.