UK investors have filed a class action lawsuit against Binance and its founder, Changpeng Zhao, in the High Court in London, seeking £150 million, or about $200.0 M, in damages. According to the claimants, Binance continued offering leveraged tokens, futures, and options to UK customers despite the regulatory ban on those products.
The investors are represented by law firm KP Law. The lawsuit alleges that products such as leveraged tokens, futures, and options remained available to users even after the UK Financial Conduct Authority (FCA) introduced a ban in January 2021 restricting the sale of these products to retail investors.
“The exchange failed to put effective safeguards in place to prevent UK customers from accessing prohibited products,” the lawyers said.
The exact number of affected users is still being determined. The legal team noted that Binance is one of the world's largest cryptocurrency exchanges, meaning the scale of the issue could be significantly greater than the cases identified so far.
One of the claimants, financial controller Tomas Sutas, invested more than $132,400 in Binance derivatives and, according to the Financial Times, lost all of his funds. Reuters, citing other exchange users, reported that some of them lost tens of thousands of pounds.
In a statement to Cointelegraph, Binance said it would defend itself against the claims through the appropriate legal process.
“Binance remains committed to its users and to complying with applicable laws,” a company spokesperson said.