On behalf of investors, a class-action complaint has been filed against Binance US, the American branch of the global crypto exchange Binance, in connection with the Terra ecosystem’s collapse.
Binance US has been named in a class action lawsuit
Binance US has been accused of misleading investors by offering unregistered securities in a class-action lawsuit filed in North California on Monday. The 72-page lawsuit claims that the cryptocurrency exchange sold Terra’s UST stablecoin despite not being registered as a broker-dealer, a breach of US securities regulations, according to the lawsuit.
The lawsuit also alleges that the business model of BinanceUS is “premised on illegally enabling the sale of unregistered securities to as many US investors as possible, as often as possible.”
The suit marks the first major US-based court case, which was filed by American law firm Roche Freedman LLP. Kyle Roche, a named partner at the law firm later tweeted:
“If you purchased $LUNA or $UST on either @coinbase @krakenfx @binance or @Gemini, please reach out to [email protected] My firm is coordinating an effort to help those who lost funds from the recent collapse of terra and luna.”
Terra ecosystem’s death spiral
The move follows the death spiral of UST, Terra’s algorithmic stablecoin, which nearly overnight wiped more than $40 billion in market value.
Terraform Labs CEO Do Kwon has since attempted to make up for lost monies by airdropping Luna 2.0 to holders.
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