- Binance, CEO, and influencers face $1B lawsuit
- Alleged promotion of unregistered securities
- Potential damages for millions
Shortly after Binance and CEO Changpeng ‘CZ’ Zhao faced a lawsuit from the United States Commodity Futures Trading Commission (CFTC) over supposed trading violations, the cryptocurrency exchange and its CEO have been targeted in a new $1 billion lawsuit. The suit accuses Binance, CZ, and three prominent crypto influencers of promoting unregistered securities, fueling controversy within the industry.
The Moscowitz Law Firm and Boies Schiller Flexner lodged the staggering $1 billion lawsuit on March 31 in the Southern District of Florida. The suit alleges that Binance engaged in trading unregistered securities and compensated influencers for the illegal promotion of these services, as stated by Fortune.
In an earlier lawsuit against Voyager, the law firm claimed that influencers who promote “unregistered securities” should be held responsible for any customer losses incurred. Binance and the accused influencers—NBA Miami Heat player Jimmy Butler and YouTubers Graham Stephan and Ben Armstrong (BitBoy Crypto)—now face the daunting task of potentially paying $1 billion in damages to harmed investors.
The lawsuit reveals that the firm has been investigating similar unregistered security issues against Binance for over a year, stating that promoters and exchanges that facilitate trades of such assets would be held liable for customer losses. Notably, the suit also asserts that investors are not required to provide evidence of being influenced by the promotional content.
Although initiated by three American citizens, the lawsuit contends that millions of people could be eligible for compensation, raising concerns for the broader investor community. The law firm is also planning to include additional Binance influencers in the suit through future filings.
In other news, ZeroSync Association, a Swiss non-profit organization, and Blockstream, a Bitcoin infrastructure business, have announced their intention to transmit Bitcoin zero-knowledge proofs, one of the most notable blockchain-tech trends of 2023, via Blockstream’s satellite network. This unique alliance aims to increase Bitcoin’s global efficiency and accessibility.
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