Cristiano Ronaldo created NFTs to reward fans for their years of support.
Cristiano Ronaldo is currently embroiled in a legal battle involving a staggering $1 billion lawsuit for his endorsement of Binance, the global cryptocurrency exchange leader.
The lawsuit, filed in a US district court in Florida, contends that the former Manchester United and Real Madrid stars "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. They are seeking damages of "a sum exceeding" $1 billion (Rs 8331 crore).
According to the BBC, in November 2022, Binance announced its first "CR7" collection of non-fungible tokens (NFTs) in partnership with Ronaldo, which the footballer said would reward fans "for all the years of support." NFTs are virtual assets that can be bought and sold but have no real-world form of their own; in other words, they only exist digitally. Generally, they are used to mark ownership of something, such as a picture or video online.
"CR7" refers to Ronaldo's initials and shirt number and is used as branding in a range of products, from footwear to fragrances, that have helped make him one of the wealthiest athletes on earth.
The news portal further said that the claimants allege that Ronaldo's promotion of Binance led to a "500% increase in searches" for the crypto exchange, which is registered in the Cayman Islands.They also say it led people to use the firm to invest in what they call "unregistered securities," such as Binance's BNB cryptocurrency.
According to the US Securities and Exchange Commission (SEC), these assets can be considered securities, and so celebrities endorsing them must follow US law.
"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," US Securities and Exchange Commission chairman Gary Gensler said.