Binance Faces £250m Group Action Over Alleged Unauthorised Crypto Sales

Binance and its founder Changpeng Zhao are facing a £250m group action over alleged unauthorized crypto sales in the UK. The claim, brought on behalf of consumers who traded cryptocurrency derivative products on Binance.com, represents around 2,700 consumers.

The Financial Conduct Authority (FCA) banned Binance Markets Limited from carrying out regulated activities in the UK without prior written consent in June 2021. The claimants argue that Binance knowingly made complex and high-risk derivative products available to users of the platform in the UK from late 2019/early 2020.

The products in question are specified investments within the scope of the Financial Services and Markets Act 2000 (FSMA), but only authorized persons or exempt persons were permitted to sell them to UK consumers. The claimants contend that Binance was neither authorized nor exempt, and many suffered substantial losses as a result of transactions placed with Binance.

Hannah Sharp, partner at KP Law, said: 'It is public knowledge that Binance have failed to cooperate with regulators.' The total value of the claims issued to date is estimated to be in excess of £250m, with an eventual total claim expected to be significantly larger.