Nearly 1,700 UK investors have filed a £150 million (nearly $200 million) claim against Binance and founder Changpeng Zhao in London’s High Court, alleging the exchange sold them high-risk crypto derivatives it was never authorized to offer.
Key Takeaways:
About 1,700 UK investors are seeking £150 million from Binance and CZ over derivatives sold from late 2019, before the 2021 FCA ban.Binance says it will defend the London High Court claim, which names entities in the Cayman Islands and the UAE.A ruling allowing the case to proceed could trigger further retail lawsuits against offshore exchanges in Britain.The claimants allege that Binance began marketing complex leveraged derivative products to UK retail investors in late 2019, roughly two years before the country’s Financial Conduct Authority (FCA) formally restricted retail access to such products in 2021. The suit, first reported by the Financial Times, seeks at least £150 million in damages.
A Binance spokesperson said the exchange would defend the claims “vigorously” and reaffirmed its commitment to complying with applicable laws. It bears mentioning that the company has faced a long series of legal and regulatory challenges across multiple jurisdictions but has repeatedly said it has overhauled its compliance program.
CZ’s Long Regulatory ShadowThe coming few months will show how far UK courts are willing to hold offshore exchanges accountable for products sold to British retail traders before tangible regulations existed.
