Nearly 1,700 individuals have filed a group lawsuit in London’s High Court against Binance, its founder Changpeng Zhao, and the Abu Dhabi-based Nest Exchange, alleging the unlawful sale of crypto derivatives to UK retail customers.
Lawsuit targets unauthorized crypto derivatives sales
The claim, submitted on June 29 by law firm KP Law on behalf of 1,692 people led by Tomas Sutas, argues that Binance and associated entities offered leveraged tokens, cryptocurrency futures, options, and margin products without proper authorization from 2019 onward.
According to the filing, these products were promoted and sold in breach of the Financial Services and Markets Act, which prohibits unauthorized regulated activities and restricts unapproved financial promotions.
The claimants are seeking restitution for funds and assets transferred to the defendants, along with interest and damages under the Senior Courts Act 1981. Binance Holdings and Zhao are accused of acting with shared intent in operating the platform, while unnamed parties are also included for allegedly supporting related services.
Claims exceed £150 million
Court documents indicate a minimum claim value of more than £200,000, meeting the threshold for High Court filing fees. However, KP Law said separately that the total amount sought by the group exceeds £150 million, though this figure is not listed in the formal claim.
One claimant, Tomas Sutas, is reported to have lost more than £100,000 through trading activities linked to the platform.
Case unfolds amid regulatory pressure
The lawsuit comes as Binance continues to face regulatory scrutiny globally. In 2023, the company pleaded guilty in the United States to charges tied to money laundering and sanctions violations, agreeing to pay $4.3 billion in penalties. Zhao also served a four-month prison sentence and was later pardoned.
More recently, Binance withdrew its application to obtain a markets in crypto-assets authorization in Greece, stating that the process had been close to completion before being halted.
A spokesperson for the company said it will defend itself through the appropriate legal channels and remains committed to meeting its legal obligations.
Timing coincides with new UK crypto rules
The legal action coincides with the UK Financial Conduct Authority finalizing a comprehensive regulatory framework for cryptoassets. Published on June 30, 2026, the rules will take full effect on October 25, 2027, requiring firms serving UK traders to obtain authorization and adhere to standards similar to traditional financial services.
Focus on past compliance and trader protection
At the center of the case is the allegation that complex financial products were made available to retail traders even after the FCA banned the sale of crypto derivatives to this group in January 2021. The filing claims there were no effective safeguards preventing UK users from accessing such offerings.
The proceedings are expected to examine how exchanges operating across borders complied with existing financial laws and whether they adequately protected traders before the introduction of crypto-specific regulation.
The outcome could set a precedent for how UK courts handle claims tied to past crypto trading losses, particularly in cases where firms operated in a regulatory grey area but may still be held accountable under existing financial legislation.
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