Cristiano Ronaldo’s Binance issue points at a larger crypto-football problem

In November 2022, Binance launched an exclusive Cristiano Ronaldo-themed NFT collection in what was the start of the Portuguese star’s multi-year partnership with the company. A statement on the company website at the time revealed that Ronaldo’s NFT collection would have four rarity levels ranging from “normal” to “super super rare”, with each NFT statue depicting a defining moment of the Al-Nassr FC striker’s glorious career.

This was a partnership that wouldn’t just have helped re-establish Ronaldo’s name globally at the end of his second stint at Manchester United FC but also helped Binance land their biggest deal right after question marks had appeared about their authenticity. At the time, it seemed like the perfect way for the two parties to rebuild their respective images. Twelve months down the line, however, the deal finds itself in the middle of legal troubles.

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NFT companies have always had a separate room for discussion in football ever since they arrived onto the scene, but the Binance-Ronaldo partnership seems like the most prominent case so far. Ronaldo is now facing a US$1bn lawsuit for his promotion of Binance, with the Cayman Islands-based company’s chief executive, Changpeng Zhao, having resigned after being found guilty in a money-laundering case. Zhao, a Canadian citizen, also pleaded guilty to having failed to register Binance as a money-transmitting business.

Zhao’s downfall comes not too long after cryptocurrency exchange FTX’s founder Sam Bankman-Fried was convicted of fraud and cheating investors to the tune of over US$10 billion. Both these cases are alarming, especially considering how deeply ingrained crypto partnerships have already become in football. It is quite intriguing, therefore, that Ronaldo, one of the game’s biggest superstars of all time, finds himself in the very middle of this controversy.

The lawsuit against the 38-year-old claims that his promotion of the Binance NFTs led to his followers investing in unregistered securities, with his advertisement of the company having led to a “500% increase in searches” for Binance. The very essence of the lawsuit is that Ronaldo misguided and manipulated his followers into investing in these products, and when one considers the backdrop of Zhao’s money-laundering case, the situation seems even murkier.

The case will ramble on for the time being, but right now it paints a rather dark picture of crypto partnerships in football, which about a year ago were the raging fad and jumped onto by clubs and players alike as a means to enhance “fan engagement” in the sport. Over a year on, valuations of the companies behind these partnerships have gone down, trading of their crypto assets reduced, and partnerships like that of Liverpool FC having failed to take off. (The Reds had signed an NFT collection deal in March last year, making 170,000 unique pieces available for their fans, 94% of which went unsold.)

Despite their drastic downfall, crypto partnerships continue to exist in football, though they are quite perfunctory at this point. Even the player-focused deals have died off, with players such as Neymar, Paul Pogba, Son Heung-min, Marcelo Brozovi? and Mateo Kova?i? barely active on that front anymore. 

Pogba, famously, signed a partnership deal with CryptoDragons in November 2021, but after an initial phase of curiosity, it was revealed that a Turkish bike courier lost three months of his wages due to the Pogba investment scheme. The tokens that once sold for 35 ETH (Ether / ?) are now for sale at US$0.00411417 (at the time of writing). 

In 2021 itself, several other players came together for a crypto scheme called FootballStars, which was promoted by the likes of Kova?i?, Brozovi?, Dejan Lovren, Arturo Vidal and Achraf Hakimi. Within a year’s time, the website of the scheme would vanish into thin air, the partnership between the company and these players seeming like it almost never existed in the first place. 

Tottenham Hotspur FC star Son, meanwhile, promoted a scheme called NFTSTAR in November 2021, but he soon had to remove the promotional post after backlash from fans and has never promoted a crypto asset since. The same transpired with Neymar, whose partnership with NFTSTAR petered out when he left Paris Saint-Germain FC to join Al Hilal SFC earlier this year.

Football-oriented crypto partnerships coming under scrutiny and quietly disappearing into thin air is in itself a well-known trend at this point. Surprisingly, Lionel Messi’s recent partnership with BitGet has proved to be a rather reliable venture thus far, with the token’s value rising. The Argentine’s partnership with Socios.com, on the other hand, barely took off, and a mere skim through his social media would suggest that BitGet has taken over his entire crypto portfolio.

Having said that, examples like these and that of NBA legend Shaquille O’Neal (with his flailing partnership with FTX) are only the tip of the iceberg for what is an increasingly struggling and dark industry relying on tapping into a younger audience through high-profile sports personalities and organisations. Football, in particular, increasingly caters to the youth worldwide, so companies view the sport as a market that can help them grow, especially if they can find access to footballers and elite clubs. While the plan to tap into this audience is certainly sensible for crypto companies, their long-term sustainability is always under question. A vast majority of them, keeping in mind the Binance and FTX examples, operate using shady means and barely have registered headquarters. The non-regulatory nature of these companies and their products makes all of this a very unreliable and problematic way for clubs and players to foster a connection with their fans.

At the end of it, crypto is about money. But considering the unregulated nature of it, investing money in it is all but a gamble — both financially and legally. The majority of the crypto market is populated by people with a sense of regret, who believe that they missed out on earning life-changing amounts of money when they missed out on investing in Bitcoin a decade ago. That sense of regret often plays on the minds of fans, who are usually well connected with their clubs.

The peak of these investments came in mid-2021 and early 2022, and considering how unsustainable these companies and operations have proven to be, it is easy to see why their partnerships are struggling to take off and fail — sometimes so spectacularly that they take their promoters with them into legal quagmires. They are proving to be risks not worth taking — for clubs, players, and their fans.