Binance Faces £150 Million UK Lawsuit Over Crypto Derivatives

Binance faces a £150M lawsuit in London's High Court as 1,692 UK investors claim the exchange offered unregulated crypto derivatives to retail users.

The lawsuit, filed in the High Court in London, represents the latest challenge for the company, which remains under intense scrutiny from regulators across multiple jurisdictions.

Claim for Over £150 Million

According to court documents, 1,692 British investors, represented by the law firm KP Law, are seeking compensation totaling at least £150 million (approximately $200 million). Individual claims for losses range from tens of thousands to several million pounds.

The defendants named in the suit include Cayman Islands-registered Binance Holdings Ltd., Nest Exchange Limited from the United Arab Emirates, exchange co-founder Changpeng Zhao, and “persons unknown” alleged to have been involved in platform management.

Allegations of Unregulated Derivatives

The claimants argue that since late 2019, Binance offered British customers futures contracts, options, and leveraged tokens—products that fall under the scope of the UK’s Financial Services and Markets Act 2000.

The complaint asserts that the exchange lacked the necessary authorization or exemption required to offer these types of investment instruments to retail investors.

The case specifically highlights the period following 2021, when the UK’s Financial Conduct Authority (FCA) banned the sale of crypto derivatives to individual investors. According to the plaintiffs, Binance failed to implement effective restrictions to prevent British users from continuing to trade these products.

Furthermore, the lawsuit alleges that the exchange actively promoted its services via social media, email, and other digital channels, encouraging retail investors to engage with complex financial instruments.

Binance Rejects the Allegations

Binance stated that it intends to defend its position “through the appropriate legal channels” but declined to comment on specific allegations due to the ongoing proceedings.

A spokesperson for the company emphasized that the exchange remains committed to its obligations toward users and operates in compliance with applicable regulatory requirements.

A Fresh Blow During a Difficult Regulatory Period

This lawsuit arrives as Binance continues to grapple with regulatory hurdles in several markets. The company has faced difficulties adapting to the new European MiCA regulations and has restricted certain services for specific European clients in recent months.

The legal action also brings past legal troubles back into focus. In 2023, Binance pleaded guilty to U.S. charges related to anti-money laundering and sanctions violations, agreeing to pay over $4 billion in penalties. As part of that settlement with U.S. authorities, Changpeng Zhao stepped down from his role as CEO.

This new UK case could become one of the most significant private lawsuits against a crypto exchange in Europe, increasing pressure on how international platforms market complex crypto financial products to retail investors.