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

More than 1,000 consumers in England and Wales have joined a group action claim against Binance and its founder Changpeng Zhao over alleged unauthorized crypto sales. The total value of the claims issued to date is estimated to be £250m, with an eventual total claim expected to be significantly larger.

The claim was originally filed in the High Court in London this past June and is brought on behalf of consumers who traded cryptocurrency derivative products on Binance.com. The Financial Conduct Authority (FCA) banned Binance Markets Limited from carrying out regulated activities in the UK without prior written consent in 2021, but Binance allegedly made these complex products available to users in the UK from late 2019/early 2020.

The claimants contend that these derivative products are specified investments within the scope of the Financial Services and Markets Act 2000 (FSMA), requiring authorization or exemption. Binance was neither authorized nor exempt, and many consumers suffered substantial losses as a result of transactions placed with the platform.