The court filings submitted by the law firms stated, “We’ve been investigating these same unregistered security issues against Binance for over a year. This is a classic example of a centralized exchange, which is promoting the sale of an unregistered security.”
Boies Schiller Flexner and Moskowitz Law Firm sued Binance, its CEO Changpeng Zhao, and three crypto influencers for promoting unregistered securities.
As reported by Fortune, the companies claimed that Binance is liable for clients’ losses as it facilitated transactions involving tokens that can be considered unregistered securities. The lawsuit also targeted Ben “BitBoy Crypto” Armstrong and two other crypto influencers for aiding Binance in the unlawful promotion of securities.
The law firms added that Binance users are eligible to receive damages equal to the full amount of losses suffered by trading “securities.” According to them, users who claim damages have no obligation to prove they were deceived by the crypto ads.
The news came less than a week after the CFTC sued Binance and CZ over accusations of the exchange’s lack of regulatory compliance.
It is worth noting that this is not the first time Boies Schiller Flexner and Moskowitz Law Firm have pressed charges against a crypto company. In 2022, Boies Schiller Flexner targeted Voyager Digital on grounds of running a Ponzi scheme.
A few weeks ago, the law firms accused eight influencers of illegally promoting FTT, the native token of the now-bankrupt crypto exchange FTX. In the words of Adam Moskowitz,
“It’s ironic that FTX was going to be the savior of Voyager until their fraud was uncovered, and now Binance is supposed to be the next savior. If we win on the unregistered securities issue, there will be no question that Binance and the influencers are liable.”
Written by
Ayush Pande
Ayush Pande is a hardware, gaming, and crypto writer based in India. He's a tech enthusiast who's fascinated by the potential of blockchain technology.
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