U.S. Supreme Court Denies Binance Appeal in Securities Lawsuit

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Binance Faces Legal Setback as Supreme Court Upholds Investor Lawsuit

Binance and its founder Changpeng Zhao, also known as ‘CZ’, have encountered a significant legal challenge as the U.S. Supreme Court has rejected their appeal to dismiss a lawsuit alleging securities violations. This decision marks a crucial development in ongoing legal battles involving the cryptocurrency exchange.

Details of the Lawsuit

The class action lawsuit, initiated by crypto traders, claims that Binance engaged in selling unregistered securities, including tokens like Tron (TRX) and EOS (EOS), without sufficient risk disclosure. The plaintiffs are seeking restitution for funds invested in these tokens, arguing that their purchases were made within U.S. jurisdiction, thus subjecting them to U.S. securities laws.

Court Rulings and Implications

Binance’s attempt to dismiss the case was initially declined by the United States Court of Appeals for the Second Circuit, which ruled that the exchange was liable for the transactions. The Supreme Court’s recent decision to uphold this ruling emphasizes the legal responsibilities that Binance has to face in the U.S. despite the company’s claims of operating outside U.S. securities laws.

Binance’s Ongoing Legal Challenges

This is not the only legal hurdle for Binance. In November 2023, Binance settled with the Department of Justice for $4.3 billion regarding violations of federal anti-money laundering laws, a case that also led to CZ’s brief imprisonment and resignation as CEO. Additionally, Binance is contending with another securities lawsuit with the U.S. Securities and Exchange Commission.

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