Binance Cristiano Ronaldo Deal Raising Alarm Bells, Concerns Over FTX Debacle Repeat
In recent days it's been reported that soccer star Cristiano Ronaldo will be joining forces with the Binance Exchange even after it has come under fire by the SEC.
The U.S. Securities and Exchange Commission said Monday that the affiliate that was set up in 2019 — Binance.US — was “part of an elaborate scheme to evade U.S. federal securities laws” and continue directing certain “high-value U.S. customers” to the main Binance exchange. The SEC issued a similar statement in regard to the cryptocurrency exchange CoinBase.
It claims that Coinbase operated as an unregistered broker through Coinbase Prime, which routes orders to Coinbase's platform and other platforms, and Coinbase Wallet, which lets investors access liquidity outside Coinbase's platform.
One has to question Ronaldo's mindset here. Little has been mentioned about the Ronaldo-Binance association this week, even though one would think the cryptocurrency exchange would want to have this deal splashed across the internet. Ronaldo might want otherwise.
Back in December, cryptocurrency exchange, FTX, collapsed. It too had employed various celebrities, Tom Brady among them, in an effort to build trust with the public.
Tom Brady and supermodel Gisele Bündchen had almost 2 million shares in FTX combined. The NFL star and his then-wife have served as brand ambassadors for FTX since 2021.
Little is known about the deal with Ronaldo. The soccer superstar has reportedly entered into an exclusive multi-year nonfungible token (NFT) collaboration with Binance.
WhaleWire alluded to the FTX comparison via its Twitter feed on Wednesday:
"Binance spent over $60 million hiring celebrities Christiano Ronaldo and The Weekend for commercial ads. All whilst funnelling millions of customer funds from Binance to CZ’s shady offshore firms. Sounds familiar? Yeah, almost identical to the FTX scandal! Be careful folks."
Binance spent over $60 million hiring celebrities Christiano Ronaldo and The Weekend for commercial ads.
— WhaleWire (@WhaleWire) June 8, 2023
All whilst funnelling millions of customer funds from Binance to CZ’s shady offshore firms.
Sounds familiar? Yeah, almost identical to the FTX scandal! Be careful folks.
Jordan Atkins writes that the SEC actions against CoinBase and Binance over the past weekend could lead to devastating financial penalties for the exchanges, as well as the evaporation of their most lucrative revenue streams.
"More than that, however, is the effect that the SEC action is likely to have on the rest of the industry, many of whom are engaged in exactly the same conduct that just got Binance and Coinbase hit with SEC charges," Atkins warns.
"All U.S. exchanges should now be on notice that they may be subject to enforcement action if they permit, or have permitted, these tokens to be traded," said Jason Allegrante, chief legal and compliance officer at Fireblocks, a digital asset infrastructure provider.
- Aaron Goldstein, Gambling911.com
