Binance Faces Class-Action Lawsuit in Canada Over Alleged Securities Law Violation
Summary:
Binance, a leading cryptocurrency exchange, is facing a new class-action lawsuit in Canada for allegedly violating local securities laws. The lawsuit, filed by plaintiffs Christopher Lochan and Jeremy Leeder, claims Binance sold crypto derivatives to retail investors without formal registration, contravening the Ontario Securities Act and federal regulations. Notably, the Ontario Securities Commission is yet to conclude its investigation into the matter. This development follows Binance's prior announcement to halt operations in Ontario, which local authorities claim it failed to adhere to.
Binance, a major player in the cryptocurrency exchange, is under fire with a fresh class-action lawsuit filed against it in Canada. The contention point made by the accusers is the alleged violation of securities laws native to the country. The Ontario Superior Court of Justice recently publicized a certification motion dated April 19, which explains the class-action legal proceedings targeting Binance for allegedly peddling crypto derivatives to retail traders without a mandatory registration.
Christopher Lochan and Jeremy Leeder, the plaintiffs spearheading the charge, insist that the accused has contravened the Ontario Securities Act (OSA) and relevant federal regulations by dealing in crypto derivatives. The duo is not just seeking damages, but also the voiding of any illegal derivatives transactions. They maintain that Binance's cryptocurrency derivatives managed to lure investment from tens of thousands of Canadians frequenting the platform.
According to the certification motion, it's important to highlight that the ranks of cryptocurrency derivative traders include a multitude of retail investors. It goes on to underscore that over half of Canada's cryptocurrency owners are invested in the market to the extent of at least $5,000, as reported by the Ontario Securities Commission (OSC).
This latest class-action undertaking against Binance follows the company's announcement of its exit from Ontario back in June 2021, in response to a cautionary warning issued by the OSC. Relatedly, the SEC is currently pursuing a sizeable $5.3B verdict against Terraform Labs and Do Kwon.
Despite Binance's clear declaration back in 2021 that it would halt sales, the OSC informed the defendant of its plan to initiate a cease trade order in the early part of 2022, owing to Binance's apparent failure to uphold the planned cessation. The litigation states that even though Binance formally announced its exodus from Canada in May 2023, local regulators persistently continue to bear down on the digital exchange. The court document additionally indicates that the OSC hasn't yet winded up its investigation into the defendants.
The story is evolving and information will be updated when it comes to light.
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Published At
4/23/2024 10:26:33 AM
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