Binance is one of several large cryptocurrency firms named in a series of recent class action lawsuits. If the lawsuits go south for this global company, it could end up costing them billions of dollars.
Class action is looking for new members
Roche Cyrulnik Freedman has recently brought eleven class action lawsuits against some of the biggest names in the crypto space, including Binance. To learn more about these cases, Cointelegraph spoke with Kyle Roche of Roche Cyrulnik Freedman, who shared his rationale behind these litigations:
“Growing enthusiasm for Bitcoin spilled over into the market for initial coin offerings (‘ICOs’), which investors flocked to in the hope of finding the next Bitcoin. The cases allege that exchanges and issuers failed to comply with federal and state securities laws.”
He also added the class action is open to new members
“…who purchased any of the tokens or did business on any of the exchanges named as Defendants. We want investors to reach out to us.”
Billions of dollars on the line
According to an anonymous source who is familiar with the matter, there was “a method to the madness”. Apparently, the focus was on “pre-minted” assets, not cryptocurrencies that employ mining:
“Most of these projects [the ones that issued pre-minted tokens] are still pretty centralized”.
The source also cited a statement by director William H. Hinman of the Division of Corporation Finance of the SEC, in which he asserted that Ether (ETH) may not be a security, since it is sufficiently decentralized.
The same source told us that the plaintiffs expect legal wranglings to take 3 to 4 years. Discussing potential monetary damages, they said:
“It’s hard to say, but it could be in the billions of dollars, Binance alone did billions.”