UK crypto investors sue Binance, Changpeng Zhao for $200M

UK crypto investors sue Binance, Changpeng Zhao for $200M

One Binance customer said he lost the equivalent of more than $132,000 from the crypto exchange’s derivatives offerings before restrictions were imposed on Binance.

The lawsuit adds to a growing list of legal and regulatory challenges for the crypto exchange, including recently failing to secure a Markets in Crypto-Assets-compliant license from a European Union member state before the July 1 deadline. Binance has also been facing allegations that it facilitated $850 million in transactions tied to a sanctioned Iranian financier that flowed to Iran’s Islamic Revolutionary Guard Corps. The crypto exchange strongly denied the allegations.

One of the affected customers, Tomas Sutas, was a financial controller who allegedly invested more than 100,000 British pounds ($132,400) into Binance’s derivatives products before the value of his investments was wiped out, the Financial Times reported. Reuters also reported that multiple UK users lost “tens of thousands of pounds” through the products.

Legal action and scope

KP Law said it is still identifying the full scope of affected customers. “While the precise number of UK customers affected is not publicly known, Binance is one of the world’s largest cryptocurrency exchanges, meaning that a substantial number of users could potentially have been exposed to these issues.”

Binance’s operations in the UK became heavily restricted in June 2021 when the FCA informed Binance Markets Limited that it couldn’t operate in the region without written consent.

Reuters noted that the lawsuit was filed in the London High Court. The Binance-affiliated Nest Exchange and “persons unknown” were also named as defendants.