A new class action against Binance has been filed in Ontario Superior Court. It alleges the cryptocurrency exchange sold crypto derivatives to retail investors without the required registration, violating Ontario securities laws, local media reported.
“Plaintiffs allege that these sales were illegal and void for lack of the requisite registration,” the court noted.
The lawsuit seeks damages from Binance based on the allegations, as well as the reversal of those trades.
In certifying the class action, the court noted that according to regulators, crypto contracts are a type of securities and fall under the regulations of the country’s Securities Act.
These are not the first problems Binance has faced in Canada.
Amid regulatory scrutiny from the Ontario Securities Commission (OSC), Binance committed in mid-2021 to end its relationship with Canadian investors and began winding down operations in Ontario by early 2022. In the weeks leading up to Binance’s departure, the exchange rescinded that commitment, claiming that the company’s registration as a money services business allowed it to continue operating in the province.
The industry giant appears to have chosen to withdraw from Ontario rather than comply with securities law or face regulatory scrutiny. The OSC’s ongoing investigation into potential regulatory violations by Binance has yet to result in formal charges.
