Binance Cryptocurrency Exchange Slapped with €2.40mln Lawsuit by French Investors
As per regional media sources, Binance France and its holding firm Binance Holdings Limited are being sued by 15 investors in France for allegedly deceptive business practises and fraudulent concealment.
In a case filed on December 14, the plaintiffs said that Binance violated French law by promoting and delivering cryptocurrency services prior to obtaining registration from the French government.
According to Cointelegraph, in May 2022, France’s financial market regulator, the Autorité des marchés financiers, will issue Binance a licence as a digital asset provider. The licence permitted the cryptocurrency exchange to perform services such as asset custody and trading.
According to the lawsuit, there are images of Binance’s social media posts before to receiving its licence, such as a Telegram channel entitled “Binance French.” The plaintiffs also allege to have suffered a loss of more than 2,4 million euros due to the fall of TerraUSD (UST), despite the fact that Binance promoted the crypto token as being backed by U.S. dollars.
In a blog article, Binance France addressed inquiries about the matter. As per the document, the business did not undertake any promotional messages in France during the relevant time period and emphasised that “Telegram groups are worldwide community forums,” enabling users to actively build and become member of channels.
Additionally, Binance responded to inquiries on Terra stablecoin advertising in the country. The business stated that its communications promote Binance staking as “secure, not the core crypto tokens.” In addition, the cryptocurrency exchange said that it always offers market risk cautions for cryptocurrency assets and has enhanced their definitions.
According to Cointelegraph, a sequence of extraordinary events in May 2022 led to an extraordinary collapse in the price of the LUNA cryptocurrency and its related stablecoin TerraUSD (UST), which was supposed to preserve algorithmic equilibrium with the U.S. dollar but shed its peg and plummeted to less than $0.30.