Miami Heat star Jimmy Butler and crypto influencer Ben Armstrong, known as "BitBoy," have reached a $340,000 settlement to resolve a class-action lawsuit accusing them of promoting Binance's unregistered securities. The settlement, which was presented for preliminary approval to a Miami federal judge on August 19, 2024, aims to bring closure to legal proceedings that began in March 2023.
Under the terms of the settlement, Butler will pay $300,000, while Armstrong will contribute $40,000. Despite the settlement, both individuals maintain their innocence. Butler has firmly denied any wrongdoing and expressed confidence in his eventual exoneration if the case were to proceed to trial. Similarly, Armstrong has asserted that he possesses "valid defenses" against the allegations.
The lawsuit against Butler and Armstrong is part of a larger legal strategy targeting Binance and its affiliates, including its former CEO Changpeng Zhao and BAM Trading, the American arm of Binance. The case also extends to Paxos Trust Company, the issuer of Binance’s BUSD stablecoin, which was named in an amended complaint filed in June 2023.
Lead attorney Adam Moskowitz has stressed the accountability of high-profile promoters involved with unregistered securities. He emphasized that Butler and Armstrong are not exempt from responsibility, highlighting the results of a year-long investigation that revealed Binance’s alleged sale of such securities.
Binance has faced intense scrutiny from U.S. regulators, particularly concerning the promotion of assets deemed as unregistered securities. This lawsuit adds to the growing list of legal challenges for Binance, exacerbated by the incarceration of its former CEO Changpeng Zhao. The class-action suit could potentially impact millions of Binance users who engaged with the platform's staking products or purchased various crypto assets through Binance.com and Binance.US.
The resolution of this case is unlikely to conclude Binance's broader legal battles. The outcome may set important precedents for how crypto promotions, especially by celebrities, are regulated and prosecuted. The scrutiny of crypto endorsements underscores the legal risks associated with promoting financial products in the fast-evolving digital asset space.
Armstrong's attorney, Darren Heitner, confirmed that a resolution had been reached but declined to provide further comments. As of now, Butler’s legal representatives have not responded to requests for comment.
This settlement marks a significant juncture in the intersection of cryptocurrency, celebrity endorsements, and regulatory oversight, illustrating the complexities and risks involved in the promotion of digital assets.
August 2024, Cryptoniteuae