Court Ruling on Shaquille O’Neal and Solana NFT Project Astrals

A Miami court ruled that U.S. basketball star Shaquille O’Neal participated in the Solana NFT project, Astrals, as a “seller,” but not as a “control person.” This decision allows O’Neal to dismiss some allegations in an unregistered securities class action lawsuit that began in May 2023.

Overview of Astrals

The Astrals project, based on Solana, featured 10,000 unique 3D avatars intended to foster investment in a metaverse-like virtual world called Astralverse, along with a decentralized autonomous organization (DAO). It also had its own cryptocurrency, Galaxy, serving as the DAO's governance token.

Promotion and Allegations

According to court documents, O’Neal promoted the Astrals project through various online platforms, including a video stating the team would persist in development until the NFTs reached a price of 30 SOL. Plaintiffs alleged that he continued promoting the project despite the FTX collapse, ultimately abandoning it, leading to a drop in NFT prices.

The plaintiffs contend that O’Neal was aware of potential regulatory issues regarding the sale of unregistered crypto securities yet still broadly promoted the Astrals project to his significant social media following.

Court’s Findings

The court dismissed the claim that O’Neal was a “control person” of Astrals, which the plaintiffs argued signified he had significant influence over the project. However, U.S. District Judge Federico Moreno confirmed O’Neal as a “seller” who actively solicited the sale of Astrals products. The judge denied the motion to dismiss the claim that Astrals NFTs and Galaxy tokens qualify as financial securities.

O’Neal’s legal team has argued he holds neither the status of a seller nor a controlling party over Astrals, asserting the NFTs and Galaxy tokens are not legally considered “securities.” The court has given O’Neal and the Astral Project until September 12 to respond to the allegations.

O’Neal has yet to comment on this matter.