Key Takeaways:
- Legal Action Against Binance: Binance faces a class-action lawsuit in Canada, accused of offering crypto derivatives to retail investors without proper registration, violating the Ontario Securities Act.
- Specific Allegations: The lawsuit, filed by plaintiffs Christopher Lochan and Jeremy Leeder, seeks damages and the cancellation of unregistered derivatives trades, highlighting the involvement of a significant number of retail investors.
- Regulatory Background and Impact: Following a 2021 warning from the Ontario Securities Commission, Binance announced its exit from the Canadian market in 2023, amid ongoing investigations into its compliance with local laws.
Cryptocurrency exchange Binance is facing a class-action lawsuit in Canada, where plaintiffs claim the company breached local securities regulations.
The lawsuit, initiated by Christopher Lochan and Jeremy Leeder, accuses Binance of offering crypto derivatives products to retail investors without the necessary registrations, in violation of the Ontario Securities Act and federal laws.
BINANCE FACES CLASS-ACTION LAWSUIT IN CANADA FOR ALLEGED SECURITIES LAW VIOLATIONS
— BSCN (@BSCNews) April 23, 2024
– Binance is facing a class-action lawsuit in Canada. Plaintiffs Christopher Lochan and Jeremy Leeder allege the firm violated the Ontario Securities Act (OSA) by selling unregistered crypto… https://t.co/AAiYBkMpUo pic.twitter.com/mkci7EwGik
This action was formalized with a certification motion filed on April 19 in Ontario’s Superior Court of Justice.
The legal action targets Binance’s alleged unregistered sales, demanding both damages and the cancellation of the disputed derivatives trades.
The plaintiffs highlight that a significant portion of Binance’s clientele, many being retail investors, participated in these markets.
Not a good day for #Binance ?
— Learn With Rony Kapoor (@LearnRony) April 23, 2024
first #india 🇮🇳and now #canada 🇨🇦sued binance for security law violations #Philippines 🇵🇭 to remove binance from Google playstore and apple app stores , following the #SEC commands.#Bitcoin #Cryptocurency pic.twitter.com/pwMff7saSU
The motion points out that over half of Canadian cryptocurrency owners possess investments exceeding $5,000.
Binance, a dominant player in the global cryptocurrency market, controls 58% of the total spot trading volumes among centralized exchanges as of March 2024.
It also operates the largest derivatives market in comparison to other exchanges like Bybit and OKX.
🚨🚨 BREAKING NEWS 👇#Binance sued in Canada for securities law violations.
— Crypto Aman (@cryptoamanclub) April 23, 2024
Even after #Binance announced departure from Canada 🇨🇦 in May 2023, local authorities have continued to investigate the exchange. pic.twitter.com/cPiaVO0lde
Data from Bybit underscores Binance’s predominant role in this sector, with it nearly monopolizing the derivatives market among centralized exchanges.
This legal challenge follows Binance’s decision to halt operations in Ontario in June 2021 after receiving a warning from the Ontario Securities Commission (OSC).
Despite Binance’s announcement in May 2023 that it would withdraw from the Canadian market altogether, the OSC has maintained its investigative efforts, signaling an ongoing concern regarding Binance’s compliance with local laws.
Unfortunately, today we are announcing that Binance will be joining other prominent crypto businesses in proactively withdrawing from the Canadian marketplace.
— Binance (@binance) May 12, 2023
We would like to thank those regulators who worked with us collaboratively to address the needs of Canadian users.…
This case is part of a broader trend of regulatory scrutiny that Binance and other cryptocurrency platforms are facing globally, reflecting the increasing attention that authorities are paying to the compliance practices of the crypto industry.
About The Author
Fleming Airunugba, a seasoned Web3 and crypto content expert, leverages his deep understanding of blockchain technology to bring the latest and most impactful news to the crypto community.
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