Binance's bid to dismiss a lawsuit over illegal crypto asset sales has hit a roadblock. The US Supreme Court declined to hear the exchange's appeal, allowing the case to proceed. Investors sued Binance in 2020. They claim the exchange failed to warn them about risks tied to tokens like ELF, EOS, and FUN. These investors now seek compensation for losses.
Binance argues US securities laws shouldn't apply to them. They maintain they're not a US-based company. A district court initially agreed, dismissing the case in March 2022. An appeals court later overturned this decision. They found evidence suggesting the transactions were domestic, based on server locations and investor activities within the US.
Binance and former CEO Changpeng Zhao petitioned the Supreme Court. They challenged the appeals court's interpretation of a 2010 legal precedent. The Supreme Court's rejection means investors can now pursue their case.
If the court sides with investors, Binance may face significant financial repercussions. The exchange could require payment of damages or restitution to token purchasers.
