Appeals court overturns dismissal of Binance class-action lawsuit

A class-action lawsuit against cryptocurrency exchange Binance led by investors has been revived by a United States appeals court, overturning a previous ruling. The court filing on March 8 stated that the district court’s decision to dismiss the investors’ claims regarding transparency issues in Binance’s sale of alleged securities was erroneous. Chase Williams, who filed the lawsuit in April 2020 on behalf of investors in a similar situation, argued that Binance sold securities without proper registration. The investors are seeking to cancel their contracts with Binance. The appeals court agreed with the plaintiffs’ claims that Binance is subject to domestic securities laws and that their initial filing was timely. Binance is also facing legal challenges from the US Securities and Exchange Commission (SEC) regarding the custody of customer assets. The SEC sued Binance, Binance.US, and its founder and former CEO Changpeng Zhao in June 2023, alleging the sale of unregistered securities and the mixing of customer assets. In November 2023, Binance reached a $4.3 billion settlement with the US Department of Justice for violating money laundering and terrorism financing laws. Zhao has pleaded guilty to money laundering charges and awaits his criminal sentencing hearing in April.