The class action lawsuits against companies like Binance relate to the sale of securities that have not been registered by the SEC, as well as the breach of trade promises by issuers.
Last week, a group of people and organizations filed class action lawsuits for suspected fraud in the New York court, referring to companies such as Binance, HDR Global Trading, TRON, Civic, Block.Oneamong other things for the sale of tokens that are not from the U.S. Securities and Exchange Commission.
According to the news portal CoinDesk, The lawsuits aim to seek compensation for investments in crypto space projects that failed to meet commercial promises, particularly cases such as Block.One regarding the ICO carried out in 2018 and what happened recently Civic.
Class action lawsuits against companies like Binance and unauthorized token sales
Reports published by various news agencies have identified the 10 complaints made to the Southern District Court In New York City, they claim the companies mentioned sold tokens to U.S. investors who use them as securities and were not properly registered with the SEC.
The class action lawsuits are led by investors such as Chase Williams, Alexander Clifford, Eric Lee and William Zhang. In cases where a large group of people band together to file a class action lawsuit. The CEO of is among the specially sued persons Binance, Changpeng Zhao; and Vinny Ligham Civic.
Regarding the case of Binance, The lawsuit states that the exchange allowed certain tokens to be traded without proper SEC approval:
Binance and the issuing companies traded illegally in the millions of dollars arising from offering and selling securities without proper registration of these tokens as such … and without Binance registering with the SEC as a broker. As a result, investors have not been properly informed of the risks associated with this type of investment, as stated in the federal and state securities laws.
Charge against Block.One
The indictment of those affected Block.One highlights significant irregularities for EOS pre-sale in 2018, which brought in around $ 4 billion at the time.
Among the comments provided by investors, it is emphasized that the tokens were created and marketed through a centralized process, which is based on proposals such as Bitcoin y ether in the main markets. However, they emphasize that this became much clearer after the commercialization of the assets so that people did not know these conditions before participating in the commercial offers.
Requirements in 2020
The allegations against EOS and other companies are similar to the facts he is facing. Ripple regarding the marketing of the XRP token, which many investors referred to as the sale of an unregistered security.
Given these allegations, the CEO of Ripple, Brad Garlinghouse explained why Ripple does not count as such within the meaning of the SEC’s definition of value, which guarantees that the token XRP It has its own ecosystem, regardless of the issuing company, and the creditors of the asset are not involved in the company.
Given the similarity of the cases, analysts highlight that the filing of these lawsuits is a result of United States law that requires a fraud case to be brought within two years of the crime being discovered. It may be for this and other reasons that many people have organized to open these legal processes and claim their rights under the boom these assets have today.
Legal experts associated with the digital currency ecosystem doubt that the court will dismiss the cases, but they also have no tendency to believe that the courts would petition for summary judicial proceedings. It remains to be seen how this situation will develop in the following months.
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Source: CoinDesk /. Daily archive of Bitcoin
Angel Di Matteo’s version / DailyBitcoin
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