Hold onto your hats, folks! Binance, the heavyweight champ of crypto exchanges, just got a legal smackdown from the U.S. Supreme Court. The court turned down a plea from Binance and its head honcho, Changpeng Zhao, who were hoping to dodge the long arm of U.S. securities laws.
Here's the scoop: A bunch of investors cried foul, accusing Binance of flogging unregistered tokens that tanked in value. The twist? Binance doesn’t have a physical headquarters. Yet, the court ruled that U.S. securities laws still apply because, hey, American investors were involved.
Back in January, a ruling came down, saying Binance needs to play by U.S. rules because transactions by American investors went down on U.S. soil. The court highlighted that U.S. investors were using Binance while chilling in the States, making those trades on U.S. servers. So, Binance can't just wave goodbye to American laws.
Binance didn’t take this lying down. They asked the Supreme Court to reconsider, arguing that thanks to tech wizardry, investors can easily dabble in foreign markets. But no dice! The Supreme Court declined their appeal, meaning the lawsuit over those unregistered tokens is full steam ahead.
Rewind to 2020, when a group of investors who’d been trading tokens on Binance since 2017, cried, “We’ve been wronged!” They claimed Binance didn’t spill the beans about the risks and wanted their cash back.
Fast forward to 2023, and the U.S. Securities and Exchange Commission (SEC) pointed fingers at Binance, alleging they were letting Americans trade crypto that should’ve been registered as securities. Binance ended up coughing up a hefty $4.3 billion to settle with the Department of Justice for breaking anti-money laundering rules.
As if that wasn't enough drama, Binance faced a class-action lawsuit in Canada after it decided to pack its bags and leave the country. Plus, the Canadian government slapped them with a $4.4 million fine for AML violations in 2024.
And here's more: Binance and Zhao are in hot water with the FTX bankruptcy estate, facing a $1.8 billion lawsuit over a sketchy deal back in 2021. Zhao even spent four months behind bars in 2024 for not having his anti-money laundering ducks in a row.
It's a wild ride in the world of crypto law, folks! Stay tuned for more twists and turns.
