At Extreme Investor Network, we are committed to providing you with the latest and most valuable information in the world of cryptocurrency and blockchain technology. Today, we bring you a breaking news story that has rocked the cryptocurrency trading industry. Binance, one of the leading players in the market, is facing a class-action lawsuit in Canada.
The Ontario Superior Court of Justice has approved the lawsuit, which alleges that Binance violated securities laws by selling crypto derivative products to retail investors without proper registration. The plaintiffs, represented by Christopher Lochan and Jeremy Leeder, claim that Binance’s actions were in violation of the Ontario Securities Act and federal law. They argue that Binance failed to register as required by securities law and neglected to file a prospectus for the derivative products sold to Canadian investors.
The certification motion for the class-action lawsuit sheds light on the significant presence of retail investors in cryptocurrency derivatives trading in Canada. According to the Ontario Securities Commission (OSC), over 50% of Canadian crypto owners hold at least $5,000 worth of cryptocurrency, highlighting the potential impact of the lawsuit on a large number of investors.
The plaintiffs are seeking damages and the rescission of the unlawful derivatives trades conducted on the Binance platform. They argue that Binance’s failure to comply with registration requirements and file a prospectus renders the sales illegal and voidable. Regulators have previously classified crypto contracts as securities or derivatives, bringing the marketing of such contracts under securities law and increasing scrutiny on platforms like Binance.
Binance’s history with Canadian investors has already attracted regulatory attention, with previous pledges to cease doing business with local investors in 2021 and agreements with the Ontario Securities Commission (OSC) in 2022. However, Binance is still under investigation for possible violations. The outcome of this lawsuit could have significant implications for the cryptocurrency industry in terms of regulatory oversight and investor protection.
It is estimated that tens of thousands of Canadian users were affected by Binance’s alleged violations, impacting retail investors who purchased the crypto derivative contracts from the platform starting on September 13, 2019. Stay tuned to Extreme Investor Network for updates on this developing story and for more exclusive insights into the world of cryptocurrency and blockchain technology.
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