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Binance legal in us7/28/2023 Despite meeting the criteria for an exchange under federal securities laws, the complaint said, Binance U.S. exchange or broker-dealer, receiving buy and sell orders from account holders and acting as the counterparty in every transaction. The new complaint alleges that Binance U.S. It’s against Binance U.S., a 2019-established subsidiary that is incorporated in Delaware and based in California. Why did the firm decide to file a new case alleging improper trading on Binance’s platform only two months after the dismissal of a suit asserting very similar claims?īecause the new case is not actually against the Malta-headquartered Binance parent company. So it's particularly notable that Roche Freedman is also co-counsel in the new Binance class action. (Investors, I should mention, are appealing the dismissal decision.) If anyone understands that hard reality, it’s the lawyers at Roche Freedman, which was co-counsel in the class action Carter dismissed. securities laws simply don’t apply to trading on a foreign exchange when the only link to the U.S. exchange.Īfter Carter's ruling, any investor who tried to sue Binance would likely face the same crippling problem: U.S. transactions, Carter said, merely by asserting that they placed orders from the U.S. And investors could not show their Binance trades were otherwise U.S. It relies on computer servers in the U.S., but the New York judge said the company's technological infrastructure did not make Binance a U.S. Binance is decentralized, with a headquarters in Malta and a CEO who lives in Taiwan. The Binance trades at issue in the New York case, Carter held, met neither test. exchanges or, in rarer instances, when they engaged in crucial trading activities inside the U.S. Investors, in the main, can only sue when they traded securities on U.S. securities laws generally do not apply beyond U.S. The Binance plaintiffs waited too long, Carter said, so their claims were time-barred.Įven more broadly - and of more importance for future Binance plaintiffs - the judge held that Binance trades were not even covered by federal securities laws. securities laws require investors to act quickly to assert claims. The judge concluded that all of the allegedly improper trades cited in the complaint were too old. District Judge Andrew Carter of Manhattan disposed of the earlier Binance case in a tight, 10-page ruling - quite a feat considering that the amended complaint was a whopping 339 pages, claiming Binance improperly facilitated trading in nine cryptocurrencies. securities laws when it facilitated trades in the collapsed stablecoin Terra USD, will have an easy time making their case. class action, which claims the company violated U.S. probably will not meet exactly the same fate as a now-dismissed 2020 class action asserting similar allegations of federal securities law violations against Binance U.S.’s parent.īut that doesn’t mean investors in the new Binance U.S. (Reuters) - A new, high-profile class action against the cryptocurrency trading platform Binance U.S.
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