tl;dr
The US Supreme Court has ruled that a class action lawsuit against Binance, a leading crypto exchange, will proceed. The lawsuit, filed by former investors, accuses Binance of illegally selling unregistered tokens. Binance's argument that the US lacked jurisdiction over the issue was rejected by the...
The US Supreme Court has ruled that a class action lawsuit against Binance, a leading crypto exchange, will proceed. The lawsuit, filed by former investors, accuses Binance of illegally selling unregistered tokens. Binance's argument that the US lacked jurisdiction over the issue was rejected by the Supreme Court. This ruling could impact Binance in several ways, as it faces legal battles in the UK and allegations of unlawfully terminating an employee. The lawsuit in question claims that Binance failed to warn users about the risks of investing in certain tokens. Former users who bought specific tokens after 2017 are eligible to join the class action suit. The Supreme Court's decision suggests challenging times ahead for Binance in this lawsuit.
The US Supreme Court ruled today that a class action lawsuit against Binance will proceed. The suit is filed by former investors who accused the exchange of illegally selling unregistered tokens. Binance claimed that the lawsuit was invalid as the US did not have jurisdiction over the issue. However, the Supreme Court rejected this argument today.
Binance, one of the world’s leading crypto exchanges, is currently facing several legal battles. In the UK, the exchange is facing allegations of unlawfully terminating an employee after whistleblowing on misconduct. However, the current class-action lawsuit in question is filed by consumers in the US. It claims that Binance failed to warn users about the significant risks of investing in certain low-cap tokens. Binance has claimed that these accusations are meritless and the securities law is inapplicable as the exchange is not located in the US. However, the Supreme Court thinks otherwise.
Changpeng “CZ” Zhao, the former CEO of Binance, was a major proponent of this Supreme Court appeal. CZ is no longer an official representative of the company, but he still has an investment in these proceedings. The Supreme Court’s ruling here could impact Binance in several ways. US federal regulators have already pursued the company on several criminal charges, but today’s appeal concerns a civil matter. Former users who bought ELF, EOS, FUN, ICX, OMG, QSP, or TRX after 2017 are eligible to join this class action suit. Although the US federal government has taken a noticeable swing towards crypto, this doesn’t necessarily impact the judiciary. Last month, the Supreme Court also allowed a shareholder lawsuit against Nvidia to proceed in an episode that parallels Binance. Now that these shareholders received the green light, the exchange’s chances in this lawsuit don’t look good. Additionally, considering it’s only a civil case, clemency from the upcoming President Trump seems extremely unlikely.