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Breaking: Binance.US Faces Lawsuit Over Selling Terra Tokens

Binance's US unit faces a class-action lawsuit for allegedly listing and illegally selling UST and LUNA tokens as unregistered securities.
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Breaking: Binance.US Faces Lawsuit Over Selling Terra Tokens

Binance.US, the U.S.-based subsidiary of the world’s largest crypto exchange Binance, has been charged with a class-action lawsuit for allegedly listing and illegally selling UST and LUNA tokens as unregistered securities.

According to the class-action lawsuit, Binance.US has failed to comply with the U.S. federal and state securities laws. Moreover, the crypto exchange falsely advertised UST as “safe” and “fiat-backed” to sell UST and LUNA tokens.

The plaintiff seeks to recover damages, consideration paid for UST, and trading fees, together with interest, as well as attorneys’ fees and costs.

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Class-Action Lawsuit Against Binance.US

The class-action lawsuit has been filed by plaintiff Jeffrey Lockhart and others against BAM Trading Services Inc. (Binance.US) and its CEO Brian Shroder at the U.S. District Court for the Northern District of California on June 13.

TerraUSD’s (UST) investors have claimed 10 causes of action in total against Binance.US and its CEO Brian Shroder. These include the offer and sale of UST and LUNA as unregistered securities, contracts to pay transaction fees to an unregistered crypto exchange, and an arbitration scheme designed to discourage retail investors from filing claims.

In fact, the lawsuit marked the first LUNA and UST-related court case filed in the U.S. after investors around the world lost nearly $40 billion in the Terra collapse. The false advertising by Binance.US has misled investors surrounding the Terra blockchain ecosystem, which caused them to lose their money.

According to the lawsuit, Terra’s founder Do Kwon had come up with the Terra 2.0 Revival Plan to start a new Terra blockchain and launch its LUNA 2.0 token, without the UST stablecoin. Binance has again supported the LUNA 2.0 listing, despite considering the benefit to its investors.

Binance.US and its CEO Brian Shroder are held responsible for the loss of investors and a jury should be appointed to return the funds of investors.

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Terra 2.0 (LUNA) Price Continues to Fall

The LUNA price has failed to gain momentum and dropped to its all-time low. The LUNA price is currently trading at $2.47, down nearly 6% in the last 24 hours. The new token has dropped 87% since its listing on May 28, 2022. Meanwhile, Terra Classic (LUNC) has fallen 10%, with the price currently trading at $0.00006033.

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Varinder Singh

Varinder has over 10 years of experience and is known as a seasoned leader for his involvement in the fintech sector. With over 5 years dedicated to blockchain, crypto, and Web3 developments, he has experienced two Bitcoin halving events making him key opinion leader in the space. At CoinGape Media, Varinder leads the editorial decisions, spearheading the news team to cover latest updates, markets trends and developments within the crypto industry. The company was recognized as Best Crypto Media Company 2024 for high impact and quality reporting. Being a Master of Technology degree holder, analytics thinker, technology enthusiast, Varinder has shared his knowledge of disruptive technologies in over 5000+ news, articles, and papers.

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Why trust CoinGape: CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights to our readers. Our journalists and analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.
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