TechFlow News, February 27: According to a Reuters report, on February 26, U.S. District Judge Andrew Carter of the Southern District of New York ruled that Binance, the world’s largest cryptocurrency exchange, cannot compel customers to resolve claims regarding cryptocurrency losses through arbitration. The judge determined that Binance failed to adequately notify users of changes to its Terms of Use—which mandated arbitration and waived the right to participate in class-action lawsuits—therefore allowing customers to pursue claims in court for losses incurred prior to February 20, 2019.
In this case, customers alleged that Binance failed to disclose “material risks” as required under federal and state securities laws when selling seven cryptocurrencies (ELF, EOS, FUN, ICX, OMG, QSP, and TRX), and sought recovery of their investment losses. The case was dismissed in 2022 but reinstated two years later by the federal appellate court.
