Binance And CZ Face One Of The UK’s Biggest Crypto Lawsuits Ever — £150 Million On The Line

Binance and its co-founder Changpeng Zhao (CZ) are facing one of the largest legal challenges the crypto industry has seen in the United Kingdom (UK). Nearly 1,700 investors have filed a claim against the exchange, alleging it sold risky derivative products to retail traders without approval from the UK’s financial regulator — with losses that some claimants say ran into “tens of thousands of pounds” each.

What the Investors Are Alleging 

According to Reuters, the lawsuit alleges that Binance entities knowingly offered leveraged products to retail customers from late 2019 onward, in breach of the Financial Services and Markets Act. 

The UK’s Financial Conduct Authority (FCA) banned crypto companies from offering derivatives to retail customers in 2021, and Binance did take some steps to restrict UK access in response, requiring users to complete additional information before proceeding.

Still, the lawsuit argues those steps were not enough, and that the exchange had already caused significant financial damage to British retail investors before those restrictions were put in place.

“Binance remains committed to its obligations to users and to operating in accordance with applicable law,” a spokesperson said in an interview with Reuters. Neither Zhao nor Binance issued any further statements on the matter as of this writing. 

Binance Is Fighting Fires On Two Fronts 

Binance is simultaneously navigating the end of the European Union’s (EU) Markets in Crypto-Assets Regulation (MiCA) transitional period, having confirmed last week that it withdrew its license application in Greece and told CNBC that some European users would see their services affected before the July 1 deadline. 

On Tuesday, Binance Co-CEO Richard Teng moved to calm those concerns, reassuring EU users that their assets remain safe and secure and that they would retain access to withdrawals and other account functions after the deadline passes.

Meanwhile, the UK’s broader regulatory picture for crypto is taking shape around the lawsuit. The FCA confirmed this week that trading platforms, custodians, and stablecoin issuers will fall under a new mandatory framework starting October 2027. 

David Geale, the FCA’s executive director for payments and digital finance, called the shift foundational rather than restrictive. “This is about giving crypto a solid foundation from which to build,” he said, describing the incoming regime as “the biggest change in the FCA scope for at least a decade.”

Featured image generated with OpenArt.