Nearly 1,700 cryptocurrency investors in the United Kingdom have launched a major legal action against Binance and its fo under, Changpeng Zhao, seeking at least £150 million, or about $200 million, in damages. The claim, filed in London’s High Court, alleges that the exchange unlawfully sold complex and high risk crypto derivatives to retail customers without the regulatory authorization required under UK financial laws.
Investors Claim Unauthorized Products
The lawsuit argues that Binance promoted leveraged cryptocurrency trading products to British retail investors beginning in late 2019. According to the claimants, the exchange offered these products in violation of the UK Financial Services and Markets Act, exposing customers to significant financial risks without the protections required by local regulations.
The investors allege that many users suffered substantial losses after trading the derivatives. Some claim they lost tens of thousands of pounds, while others reportedly experienced even larger financial setbacks. The legal action names Binance Holdings, Nest Exchange, Changpeng Zhao, and additional unidentified individuals allegedly involved in operating the Binance trading platform.
Binance Prepares Legal Defense
Binance has stated that it intends to defend itself against the allegations. While the company declined to discuss the ongoing litigation in detail, it said it remains committed to meeting its obligations to users and complying with applicable laws.
The case arrives as Binance continues to navigate heightened regulatory scrutiny across multiple jurisdictions. In the United Kingdom, regulators prohibited the sale of crypto derivatives to retail investors in 2021, prompting Binance to introduce additional restrictions for UK users.
Broader Regulatory Pressure
The lawsuit adds to the exchange’s growing list of legal and regulatory challenges worldwide. In recent years, Binance has faced enforcement actions in several major markets while working to strengthen its compliance framework and secure operating licenses.
Legal experts say the outcome of the London case could influence how courts interpret the responsibilities of global cryptocurrency exchanges serving retail investors across borders. The proceedings may also shape future expectations for crypto platforms offering sophisticated financial products in regulated markets.
