NBA Hall of Famer Shaquille O’Neal has given his nod to an $11 million settlement over the failed Astrals NFT project.
O’Neal and his Astral NFTs co-creators were the respondents in a class suit filed last May 23, 2024. The plaintiffs argued that the non-fungible tokens were linked to O’Neal’s popularity and that many investors bought the product due to the association of basketball players with the project.
However, when O’Neal tried to disassociate himself from the project, the NFT’s market value dropped, leaving many investors with losses.
The settlement fund will repay investors who invested in these unregistered securities, including its governance token, GLXY, and Solana-based NFTs.
Shaquille O’Neal has agreed to an $11 million settlement, following a lawsuit brought by investors in Astrals, a failed solana-based NFT project https://t.co/27tkiRDgzd
— Sherwood News (@sherwood_news) November 19, 2024
Settlement Will Bring Closure To The O’Neal-Astral NFT Drama
The class suit over O’Neal’s association with the Astral project was filed on May 23rd in the Southern District of Florida, Miami Division, with Daniel Harper as the leading plaintiff. O’Neal was promptly served the notice of the suit on May 23rd, during a basketball game at the Kaseya Center in Miami.
According to the plaintiffs, O’Neal was guilty of defrauding investors by offering unregistered securities through the Solana-based NFTs and GLXY governance tokens.
A Florida federal judge initially commented that the NBA star could be labeled under the existing securities laws. The judge’s observation and initial assessment are based on the player’s financial interest in the project and his active marketing of the project on social media.
On August 16th, a Miami federal court judge formally acknowledged O’Neal’s role in the failed project.
Astral Team Admits To Losses
In October, the Astrals team admitted that the project is struggling financially and is considering filing for bankruptcy. The team added that it will no longer support the GLXY governance token, explaining that it’s no longer feasible.
By agreeing to the $11 million settlement amount, O’Neal can avoid a complicated and drawn-out legal process. O’Neal initially filed a motion to throw out the class suit, arguing that digital assets (including the NFTs) were designed for gamers and not for investors.
More Celebs Get In Trouble Over Unregistered Digital Assets
O’Neal isn’t the only celebrity charged with promoting digital assets and cryptocurrencies. Kim Kardashian was also fined $1.3 million by the Securities and Exchange Commission (SEC) for her endorsement of EthereumMax.
Also, Seinfeld co-creator Larry David and football player Tom Brady were implicated in the bankruptcy of the FTX crypto exchange.
According to analysts, the NFT market is currently growing. Sales of NFTs increased to $356 million for October 2024, reflecting an 18% improvement from the previous month. The number of transactions also increased to 7.2 million.
Featured image from AfroTech, chart from TradingView