Binance Faces Legal Trouble In Canada For Alleged Securities Law Breaches

Despite Binance’s exit from Canada in May 2023, local authorities have continued to scrutinize the cryptocurrency exchange.

Binance, a prominent cryptocurrency exchange, is facing a new class-action lawsuit in Canada, where plaintiffs claim that the firm breached local securities regulations.

On April 19, Ontario’s Superior Court of Justice issued a certification motion for a class-action lawsuit against Binance, alleging that it sold crypto derivative products to retail investors without proper registration.

Plaintiffs, represented by Christopher Lochan and Jeremy Leeder, claim that Binance’s sale of crypto derivatives violated the Ontario Securities Act (OSA) and federal regulations.

The lawsuit, represented by plaintiffs Christopher Lochan and Jeremy Leeder, seeks compensation and rescission of illicit derivatives trades.

The plaintiffs contend that tens of thousands of Canadian users invested in cryptocurrency derivatives on Binance’s website.

“It is noteworthy here that cryptocurrency derivatives traders include a great many retail investors,” the certification motion reads, adding that more than 50% of Canadian crypto owners have at least $5,000 in the market, according to the Ontario Securities Commission (OSC).

The recent class-action lawsuit against Binance follows the crypto exchange’s announcement in June 2021 that it would stop operating in Ontario, after receiving a warning from the Ontario Securities Commission (OSC).

“As a result of its failure to adhere to this announced cessation of sales, in early 2022, the OSC notified the defendants of its intention to seek a cease trade order,” the new court document reads.

Despite Binance’s announcement to leave Canada in May 2023, local authorities have continued to clamp down on the exchange. As noted in the court motion, “The OSC’s investigation into the Defendants is ongoing.”

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