A group of Italian and international investors have filed a class-action suit against major crypto exchange Binance, alleging the firm violated its own rules on futures trading.
In a Tuesday announcement, Italy-based legal and consulting firm Lexia Avvocati said it would be taking legal action against Binance to recover damages from trades on the crypto exchange’s futures platform. On behalf of a group of investors, the company and the Swiss Blockchain Consortium allege Binance breached its rules on crypto derivatives trading and did not function properly at certain peak trading times.
According to local news outlet Milano Finanza, the lawsuit is centered around the crypto exchange going offline for several hours on different days — such as on Feb. 8, when Elon Musk announced that Tesla had purchased $1.5 billion in Bitcoin (BTC). The investors in the class-action suit allege they lost “tens of millions” of dollars due to not being able to manage their trading positions and view their balances. They also claim similar outages that occurred on April 18, May 5, May 19, May 28 and June 4 were grounds for compensation.
Though Binance did reportedly allow users affected by the outages to request compensation, Lexia said the exchange was offering a “pitiful amount” for its clients, who refused the “laughable” proposal. The law firm said the investors would be willing to dismiss the lawsuit if Binance were to appropriately compensate them before July 12, also warning it would seek regulatory restrictions for the exchange in the European Union and Switzerland.
The legal action comes amid Thailand’s Securities and Exchange Commission and the Cayman Islands Monetary Authority recently announcing a regulatory crackdown on Binance for operating in their respective jurisdictions without a proper license. In March, news outlets reported the exchange may also be under investigation by the United States Commodity Futures Trading Commission regarding possible trades made by U.S.-based customers.
Cointelegraph reached out to Lexia for comment but did not receive a response at the time of publication. This story may be updated.
Sourced from cointelegraph.com.
Written by Turner Wright on 2021-07-06 16:31:03.