Miami Heat’s Jimmy Butler and YouTube’s BitBoy Crypto agree to a $340,000 settlement in a lawsuit alleging their role in promoting unregistered securities through Binance, amid wider cryptocurrency legal challenges.
Miami Heat forward Jimmy Butler and YouTube influencer Ben Armstrong, known as “BitBoy Crypto,” have agreed to pay $340,000 to resolve a lawsuit accusing them of misleading investors into purchasing unregistered securities from Binance Holdings Limited, the world’s largest cryptocurrency exchange. The settlement, reached after prolonged mediation, denies any admission of wrongdoing by the high-profile figures.
The lawsuit, which initially surfaced last year, accused Butler, Armstrong, Binance, and its co-founder Changpeng Zhao of luring customers into investing in cryptocurrencies and tokens that were, in fact, unregistered securities, thus violating U.S. law. The case has drawn considerable attention, especially given the involvement of Binance, a global powerhouse in the cryptocurrency market.
According to court records, the settlement agreement was submitted on Monday in Miami federal court and is now awaiting preliminary approval from U.S. District Judge Roy Altman. This legal development follows extensive negotiations led by mediator and former Miami-Dade Circuit Judge Michael Hanzman. Should Judge Altman give preliminary approval, a final hearing will be scheduled, providing an opportunity for affected investors to express their views on the settlement.
The legal troubles surrounding Binance and its affiliates are not new. Last year, Binance Holdings Limited and its co-founder, Zhao, reached a separate settlement with the U.S. Justice Department, agreeing to pay $4 million after pleading guilty to charges related to anti-money laundering and U.S. sanctions violations. Despite these serious allegations, Binance.com was permitted to continue its operations under specific conditions.
The lawsuit against Butler and Armstrong highlights the increasingly complex legal landscape surrounding cryptocurrency investments, particularly the promotion of digital assets that may not comply with U.S. securities laws. The case underscores the heightened scrutiny facing influencers and public figures who endorse financial products, especially in the rapidly evolving digital currency market.
In a related case, Austin Michael Taylor, the founder of the CluCoin cryptocurrency project and owner of the Aventura-based company CLU LLC, pleaded guilty to wire fraud earlier this month in Miami federal court. Taylor, who promoted CluCoin using his substantial social media following, was accused of transferring $1,140,000 of investor funds into his personal account. Prosecutors revealed that Taylor had used a white paper to attract investors, presenting CluCoin’s Initial Coin Offering (ICO) as a charitable venture.
Taylor’s CluCoin project, launched in 2021, was initially marketed as a digital token with a charitable mission. However, prosecutors allege that Taylor later diverted the project’s focus toward new ventures, including non-fungible tokens (NFTs), a computer game, and a metaverse platform. Taylor now faces up to 20 years in prison, with his sentencing scheduled for October 31.
These legal challenges are part of a broader crackdown on fraudulent activities within the cryptocurrency space, as authorities continue to target those who exploit the rapidly growing digital asset market. The outcomes of these cases are likely to have far-reaching implications for the regulation and promotion of cryptocurrencies in the U.S. and beyond.
For Butler and Armstrong, the settlement may close one chapter of legal troubles, but it also serves as a cautionary tale for celebrities and influencers navigating the uncharted waters of cryptocurrency endorsements. As the digital economy expands, the legal frameworks governing these assets are tightening, making compliance and transparency more critical than ever.
