Binance is facing one of its largest retail investor lawsuits yet, with nearly 1,700 British traders hauling the exchange and founder Changpeng Zhao into London’s High Court, demanding at least £150 million ($200 million) in damages over crypto derivatives the claimants say should never have been sold to them in the first place.
According to Reuters, which first reported the filing on June 30, the claimants allege Binance sold them risky leveraged derivative products without ever securing regulatory authorisation in the UK.
Some of the investors named in the suit say their losses ran into tens of thousands of pounds each, and the group’s argument centres on a straightforward legal point: if Binance was never licensed to sell these products to UK retail customers, the contracts may not have been enforceable to begin with.
What the claim actually says
The suit, filed at London’s High Court, names four defendants: Cayman Islands-registered Binance Holdings, UAE-based Nest Exchange, Zhao himself (still widely known by his initials, CZ), and a catch-all group described as “persons unknown” who are alleged to operate the Binance trading platform behind the scenes.
The claimants say Binance began marketing complex crypto derivatives to UK retail investors from late 2019, a full two years before Britain’s Financial Conduct Authority formally banned the practice. That’s the crux of the case.
The FCA’s 2021 ban on selling crypto derivatives and exchange-traded notes to retail consumers is well documented, but the lawsuit argues Binance was already operating outside acceptable lines before that ban even existed, and continued in violation of the Financial Services and Markets Act afterward.
Binance has said it will contest the case. A company spokesperson told Reuters the exchange remains focused on meeting its obligations to users and operating within the law, though it declined to comment further given the litigation is ongoing.
A familiar playbook, familiar regulator
This isn’t the first time Binance’s UK operations have run into friction with the FCA. After the 2021 derivatives ban, Binance restructured under UK financial promotion rules and required additional verification steps for UK users trying to access certain products. Whether those steps came early enough or covered everyone the lawsuit represents is now something a judge will have to work through.
The stakes go beyond the £150 million figure. Under the Financial Services and Markets Act, deals arranged by a firm that wasn’t authorised to offer them can potentially be ruled unenforceable, which would let customers claim back both their principal and their losses. If the court finds in the claimants’ favour on that point, it wouldn’t just resolve one lawsuit; it could set a template other unauthorised-seller claims lean on for years.
The timing could not be more awkward for Binance
This lawsuit didn’t land in a vacuum. It arrived the same week the FCA published its long-awaited final rulebook for crypto in the UK, closing out a multi-year “Crypto Roadmap” that brings exchanges, custodians, stablecoin issuers and staking providers under a unified licensing regime starting October 25, 2027.
Firms will be able to apply for authorisation between September 30, 2026, and February 28, 2027, and existing anti-money-laundering registrations won’t automatically carry over, meaning even firms with a UK presence today will need to reapply from scratch.
It’s also landing days after Binance’s European business took a separate hit. As The Crypto Times reported when Binance withdrew its Greek MiCA application, the exchange pulled its bid for an EU-wide crypto licence just a week before it was reportedly set to be rejected outright by Greece’s Hellenic Capital Market Commission.
That decision forced Binance to halt services for EU customers from July 1, with users across France, Italy, Poland and Spain told to withdraw funds or wait for the exchange to secure authorisation elsewhere. Rivals didn’t waste the opening either; Coinbase moved quickly with a Luxembourg MiCA hub, and OKX founder Star Xu has spent the past week publicly needling CZ over Binance’s compliance record.
Put together, Binance is now defending a nine-figure UK lawsuit over pre-2021 conduct at the exact moment its European licensing strategy has collapsed and Britain’s regulator has just finished writing the rulebook Binance will need to pass to keep operating there long-term.
The bigger regulatory shadow
None of this happens in isolation from Binance’s broader legal history. In 2023, Binance and CZ pleaded guilty in the United States to anti-money-laundering and sanctions violations, agreeing to a $4.3 billion settlement, one of the largest corporate penalties ever handed down in the sector.
CZ served four months in prison, stepped down as chief executive in favour of Richard Teng, and was later pardoned by President Trump in October 2025. He still holds roughly 90 percent of the company.
That history isn’t incidental to the current UK case or the Greek MiCA rejection. Regulators evaluating Binance today, whether in Athens or London, are working against the backdrop of a company that has already admitted to serious compliance failures elsewhere. Whether that colours how a London judge reads this derivatives claim remains to be seen, but it’s unlikely to work in Binance’s favour.
What happens next
No court date has been set yet, and cases of this size in London’s High Court typically take months, sometimes years, to reach trial, particularly when defendants are spread across multiple jurisdictions like the Cayman Islands and UAE, which can complicate enforcement even if claimants win.
For now, Binance says it intends to fight the claim rather than settle, but with UK crypto regulation tightening sharply just as this lawsuit gets underway, the exchange’s legal and regulatory calendar for the next 18 months just got considerably more crowded.
Also Read: CZ Opens Up on Binance’s MiCA Setback, Questions STRC Complexity
