FTX Fallout: Shaq Cuts $1.8M Check in Explosive Crypto Class Action

Based on available reports, Shaquille O’Neal, the NBA Hall of Famer and media personality, has agreed to pay $1.8 million to settle a high-profile FTX lawsuit that accused him of promoting unregistered securities tied to the now-bankrupt crypto exchange. If approved by the court; the settlement will be one of the biggest celebrity-focused class action cases to emerge from FTX’s collapse.

O’Neal denies any wrongdoing but the settlement includes not only financial restitution but also a legal release shielding him from future FTX claims and a provision prohibiting him from seeking repayment from the company’s bankrupt estate.

First Big Settlement in a Celebrity Crypto Case

O’Neal’s settlement is the largest publicly disclosed payout by a celebrity caught in the FTX fallout. According to court documents, he was paid around $750,000 for his FTX promotions, including a 2022 ad where he said he was “all in” on the platform, comments he later walked back.

The lawsuit, filed by investors claiming to have lost money on the exchange, alleges O’Neal “actively participated” in offering and selling unregistered securities through his FTX endorsements. Plaintiffs argue his promotions gave FTX a veneer of legitimacy, attracting users who might not have otherwise put their money on the platform.

Several other celebrities like Trevor Lawrence, Tom Nash and Kevin Paffrath have reportedly reached private settlements in recent months but O’Neal’s is the first public settlement of substance.

Legal Immunity and Closure

If the settlement is approved, O’Neal will get full legal immunity for FTX claims, including future claims. The $1.8 million will cover legal and administrative costs, with the rest going to investors who deposited funds or held FTT between May 2019 and November 2022.

O’Neal’s lawyers said in a statement to CNBC: “We are glad to have this behind us.” The plaintiffs’ lawyers, led by the Moskowitz Law Firm, have not commented yet. This also ends months of unusual legal wrangling, including attempts to serve O’Neal at the TNT Studios in Atlanta where he works as an analyst.

A Pattern of Celebrity Crypto Endorsements in Trouble

O’Neal is one of several public figures caught up in the FTX fallout. Other defendants in related lawsuits are Tom Brady, Gisele Bündchen, Naomi Osaka, Stephen Curry and Shark Tank’s Kevin O’Leary, all of whom were reportedly paid by FTX to be ambassadors or appear in marketing materials that touted the exchange as safe and future-proof.

Plaintiffs say these endorsements collectively duped retail investors into trusting a platform that, in hindsight, had no financial controls and was allegedly full of fraud. FTX’s collapse in November 2022 resulted in tens of billions in lost value, locked customer assets and global regulatory fallout.

Its founder, Sam Bankman-Fried, was sentenced to 25 years in federal prison in March 2024 on charges of wire fraud and conspiracy.

Not O’Neal’s First Crypto Legal Trouble

This FTX settlement is not O’Neal’s only recent crypto-related lawsuit. According to officials, in 2024, he also reportedly agreed to pay $11 million to settle claims related to Astrals, an NFT project he helped launch but allegedly abandoned shortly after. That class action also accused him of misleading investors by promoting the project without following through on its roadmap or community engagement promises.

Combined, the two settlements are a costly chapter for the basketball legend who has long presented himself as a likable and trustworthy guy. O’Neal has said in interviews he didn’t fully understand cryptocurrency. Plaintiffs have argued his influence, especially among casual fans and retail investors, played a measurable role in amplifying FTX’s reach and legitimacy.

The Bigger Picture for Crypto Promotion

Beyond O’Neal, the FTX lawsuit sets a big standard for how courts will treat celebrity endorsements in the crypto space. The class action isn’t just about securities law violations but marketing ethics, investor trust and the role of influence in financial decisions.

Legal experts say the O’Neal FTX lawsuit settlement will encourage more celebrities to settle similar cases before they go to trial especially given the reputational and financial risks involved. With the SEC cracking down on celebrity crypto endorsements, the industry is entering a new era of accountability.

But there are still questions around how much liability influencers should have for promoting platforms they didn’t control and how courts will weigh endorsement vs active participation.

Conclusion: The FTX Lawsuit Is a Turning Point for Celebrity Crypto Promotions

Shaquille O’Neal’s $1.8 million settlement of the FTX lawsuit is a big moment in the aftermath of the exchange’s implosion. He didn’t admit guilt but the terms and scope of the deal say a lot about the risks of celebrity crypto endorsements.

As courts and regulators pick apart FTX, public figures in the digital asset space may now think twice before putting their name behind a platform they don’t fully get.

FAQs

What’s the Shaquille O’Neal FTX lawsuit?

A class action alleging O’Neal promoted unregistered securities through his FTX endorsement.

How much is O’Neal paying to settle?

$1.8 million for legal fees, administrative costs and partial restitution to investors.

Did O’Neal admit wrongdoing?

The settlement includes no admission of liability and full legal immunity.

Are other celebs in FTX lawsuits?

Yes. Tom Brady, Naomi Osaka, Kevin O’Leary and others were named in similar suits. Some settled privately.

What other crypto legal issues has O’Neal faced?

In 2024 he paid $11 million to settle a separate lawsuit over the Astrals NFT project he co-founded and promoted.

Glossary

FTX – The collapsed crypto exchange founded by Sam Bankman-Fried.

FTT – The FTX token.

Class Action Lawsuit – A lawsuit filed by a group of plaintiffs with similar claims against a defendant.

Unregistered Securities – Financial products sold to the public without SEC registration and potentially violating securities law.

Endorsement Liability – The legal risk celebrities face when promoting products that fail or break the law.

Sources

CNBC

Bloomberg Law

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