An unprecedented class-action lawsuit numbering more than 2,000 plaintiffs has been filed against Binance.US in the aftermath of the Terra collapse, accusing the exchange of “misleading investors”.
First Terra Class-Action in the US
Filed in the US District Court for the Northern District of California, the lawsuit marks the first Terra class-action in the US. Roche Freedman LLP will be championing the investors’ case in alleging that Terra’s US dollar-based UST was marketed with higher stability than claimed and promoted by misleading advertising.
Roche Freedman also alleges that Binance.US is not registered as an exchange, nor as a broker-dealer, meaning it could have been violating securities law by listing an unregistered security in UST:
Binance.US has responded to these claims in stating that “Binance.US is registered by FinCEN [US Treasury’s financial intelligence unit] and adheres to all applicable regulations. These assertions are without merit, and we will defend ourselves vigorously.” The lawsuit also names Binance’s chief executive, Brian Shroder, as a co-defendant.
Binance Challenges Money-Laundering Allegations
Only a week ago, Binance challenged allegations regarding the laundering of US$2.4 billion. According to a Reuters report, the stolen funds had been laundered through the exchange between 2017 and 2021. The report, which Binance labelled a “woefully misinformed op-ed”, followed previous investigations into unreported crypto income.