Cryptocurrency exchange Binance and its founder, Changpeng Zhao (CZ), are facing a tough legal battle in the United States.
Recently, the US Supreme Court declined to hear Binance’s appeal in a class-action lawsuit. This decision allows the case, originally filed in 2020, to move forward.
Why Is Binance in Legal Trouble?
The lawsuit claims that Binance sold unregistered tokens to investors in the US. These tokens reportedly caused significant financial losses.
Chase Williams, the lead plaintiff, alleges that Binance acted as an unregistered securities exchange and broker-dealer.
The case raises questions about whether US securities laws apply to Binance, even though it has no physical office in the country.
Key Rulings and the Supreme Court’s Decision
In March 2024, a lower court ruled that Binance’s activities fall under US securities laws because transactions occurred on US servers, and many token purchases were completed in the US.
Binance argued that technological advances allow Americans to trade on foreign exchanges, making the case complex. Despite this, the Supreme Court refused to review the appeal in January 2025, clearing the way for the lawsuit to proceed.
Other Legal Issues Facing Binance
This lawsuit is one of many legal challenges Binance is dealing with. Here’s a quick overview of its recent legal troubles:
- US Securities and Exchange Commission (SEC) Lawsuit (2023):
The SEC accused Binance and CZ of offering unregistered securities and illegally providing services to US residents. - Settlement with the Department of Justice (November 2023):
Binance agreed to pay $4.3 billion to settle allegations of money laundering and terrorism financing. - Class-Action Lawsuit in Canada (April 2023):
Binance faced a lawsuit for violating securities laws after announcing its exit from Canada. - FTX Bankruptcy Lawsuit (2021):
The FTX bankruptcy estate is pursuing $1.8 billion from Binance, claiming a fraudulent share agreement. - Money Laundering Charges (August 2024):
CZ admitted to facilitating money laundering. He served a four-month prison sentence earlier in 2024.
What This Means for Crypto Investors
The Supreme Court’s decision highlights the growing regulatory scrutiny of cryptocurrency exchanges. It also shows how US laws can impact companies operating globally. Investors should remain cautious and ensure they understand the risks of trading on international platforms.
The Future of Binance
While Binance is one of the largest crypto exchanges in the world, its legal challenges are far from over. The company must navigate lawsuits, regulatory changes, and growing pressure from governments worldwide. How Binance responds to these challenges will shape its future in the cryptocurrency industry.
Conclusion
Binance’s ongoing legal issues underscore the importance of transparency and compliance in the crypto world. For investors, this serves as a reminder to be vigilant about where and how they trade. As the case progresses, it could set a precedent for how US laws apply to international cryptocurrency exchanges.
This article has been carefully fact-checked by our editorial team to ensure accuracy and eliminate any misleading information. We are committed to maintaining the highest standards of integrity in our content.
Filza specializes in simplifying financial topics for everyday readers. Whether breaking down Canada’s tax guides or U.S. benefits like SNAP and VA Disability, Filza’s relatable writing style ensures readers feel confident and informed. Follow her insights on LinkedIn or reach out via email at shewrites.health@gmail.com.
