Key Ideas:
- For allegedly concealing fraud and engaging in dishonest business practices, Binance France and Binance Holdings Limited are being sued.
- Because Binance promoted TerraUSD (UST) as being backed by US dollars, the plaintiffs additionally assert that they lost more than 2.4 million euros as a result of the token's collapse.
15 French investors are suing Binance France and its parent company, Binance Holdings Limited, for allegedly engaging in dishonest business practices and fraudulent concealment, according to local media reports.
In a lawsuit brought on December 14 by the plaintiffs, it was claimed that the exchange had broken French law by advertising and providing cryptocurrency services before being registered in the nation. The exchange received a license as a provider of digital assets from France's Autorité des marchés financiers in May 2022. The license gives the cryptocurrency exchange the ability to offer services like asset custody and trading in cryptocurrencies.
A Telegram channel called "Binance French" and other social media operations of Binance prior to its license are also shown in images that are part of the indictment. Because Binance promoted TerraUSD (UST) as being backed by US dollars, the plaintiffs additionally assert that they lost more than 2.4 million euros as a result of the token's collapse.
In a blog post, the exchange responded to questions regarding the situation. They claimed that the company made no promotional messages in France during the relevant time and described Telegram groups as global community forums where users can create and join channels at their own discretion.
Concerns about Terra stablecoin advertising in the country were also addressed during the trade. The company said that rather than the underlying tokens, their communications present staking with Binance as safe. The exchange added that its explanations have been improved and that it always includes market risk warnings for digital goods.
