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News

Binance Australia Sued Over $8.29M Compensation Claim

4 hours ago - Around 2 mins mins to read

Key Points:

  • Binance Australia sued by ASIC for misclassifying over 500 retail clients as wholesale investors.
  • Binance agrees to compensation: The exchange has accepted to pay $8.29M to affected users but has issued no public statement regarding the lawsuit.
Binance Australia Sued by ASIC for misclassifying over 500 customers, leading to inadequate consumer protections and significant financial losses.
Binance Australia Sued Over $8.29M Compensation Claim

Binance Australia Sued for Misclassifying Customers

The legal troubles surrounding Binance seem far from over. On December 18, 2024, the Australian Securities and Investments Commission (ASIC) filed a lawsuit against Binance Australia, accusing the exchange of misclassifying more than 500 individual customers.

The misclassification denied these users adequate consumer protections for high-risk derivative products. Sarah Court, Deputy Chair of ASIC, stated: “Our case alleges that Binance’s compliance systems were insufficient, exposing over 500 customers to speculative high-risk products without appropriate consumer safeguards. Many of these customers suffered significant financial losses.”

According to ASIC, between July 2022 and April 2023, Binance Australia incorrectly categorized these users as “wholesale customers.” As a result, they were excluded from certain protections afforded to retail investors, including the right to public disclosures and access to dispute resolution systems.

Read more: Binance Alpha Announced 10 Hot Projects That Could Be Listed

Binance Agrees to $8.29M in Compensation

The derivative products listed on Binance Australia’s platform included BTC, ETH, and BNB futures contracts.

In response to the lawsuit, Binance agreed to pay $8.29 million in compensation, covering total damages and court fees. However, the exchange has made no public statement addressing the incident.

This is not Binance’s first legal issue with regulators. In 2023, the platform faced numerous lawsuits from U.S. authorities. By 2024, Binance had additional regulatory challenges in Nigeria and was recently named in India’s tax evasion investigations involving crypto companies.

Conversely, Australia has also taken enforcement action against other exchanges. Recently, the Australian government fined Kraken $5 million for failing to comply with financial product regulations.

DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
News

Binance Australia Sued Over $8.29M Compensation Claim

Key Points:

  • Binance Australia sued by ASIC for misclassifying over 500 retail clients as wholesale investors.
  • Binance agrees to compensation: The exchange has accepted to pay $8.29M to affected users but has issued no public statement regarding the lawsuit.
Binance Australia Sued by ASIC for misclassifying over 500 customers, leading to inadequate consumer protections and significant financial losses.
Binance Australia Sued Over $8.29M Compensation Claim

Binance Australia Sued for Misclassifying Customers

The legal troubles surrounding Binance seem far from over. On December 18, 2024, the Australian Securities and Investments Commission (ASIC) filed a lawsuit against Binance Australia, accusing the exchange of misclassifying more than 500 individual customers.

The misclassification denied these users adequate consumer protections for high-risk derivative products. Sarah Court, Deputy Chair of ASIC, stated: “Our case alleges that Binance’s compliance systems were insufficient, exposing over 500 customers to speculative high-risk products without appropriate consumer safeguards. Many of these customers suffered significant financial losses.”

According to ASIC, between July 2022 and April 2023, Binance Australia incorrectly categorized these users as “wholesale customers.” As a result, they were excluded from certain protections afforded to retail investors, including the right to public disclosures and access to dispute resolution systems.

Read more: Binance Alpha Announced 10 Hot Projects That Could Be Listed

Binance Agrees to $8.29M in Compensation

The derivative products listed on Binance Australia’s platform included BTC, ETH, and BNB futures contracts.

In response to the lawsuit, Binance agreed to pay $8.29 million in compensation, covering total damages and court fees. However, the exchange has made no public statement addressing the incident.

This is not Binance’s first legal issue with regulators. In 2023, the platform faced numerous lawsuits from U.S. authorities. By 2024, Binance had additional regulatory challenges in Nigeria and was recently named in India’s tax evasion investigations involving crypto companies.

Conversely, Australia has also taken enforcement action against other exchanges. Recently, the Australian government fined Kraken $5 million for failing to comply with financial product regulations.

DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.