Binance, a leading cryptocurrency exchange, has recently been involved in significant legal proceedings. In November 2024, the estate of the defunct crypto exchange FTX filed a lawsuit against Binance and its former CEO, Changpeng Zhao, seeking to recover nearly $1.8 billion. The lawsuit alleges that these funds were fraudulently transferred during a share repurchase deal in July 2021. Additionally, it accuses Zhao of sending misleading tweets that precipitated a run on FTX, exacerbating its collapse.
In a separate development, Australia's corporate watchdog, the Australian Securities and Investment Commission (ASIC), initiated legal action against Binance's local derivatives business in December 2024. ASIC alleges that Binance misclassified 505 retail investors as wholesale clients between July 2022 and April 2023, thereby denying them consumer protections. Following a review in April 2023, ASIC revoked Binance Australia Derivatives' financial services license.
These legal challenges highlight the increasing regulatory scrutiny faced by Binance in various jurisdictions. The outcomes of these cases could have significant implications for the exchange's operations and the broader cryptocurrency market.