There has been a lot of news recently regarding Binance beefing up its various compliance-related functions during the past year. The crypto exchange took this step after it faced a fair bit of scrutiny coming from various regulators across the globe. Traders have also taken legal action against Binance, as they claim they lost a fair bit of profits once the exchange experienced a massive crash. For those who don’t know, binance had to endure a crash as the crypto markets across the globe we facing turmoil.
A large number of traders stated that they ended up losing around $20 million once the exchange experienced a downfall during the mid of May. This happened after China made the announcement regarding a crypto crackdown. As you would expect, this caused bitcoin prices to plummet significantly. However, bitcoin was not the only crypto that had to endure the damage. Other types of crypto also had to face the music with smaller coins, in particular, facing a massive plummet.
There is a steering group that received a fair bit of backing from Liti Capital that was launched for bringing all of the Binance related claims up to ensure traders could avenge their losses. Believe it or not, more than seven hundred traders ended up losing a great deal of money because of the platform’s outage. They were not able to make any kind of trade for a long period of time, which potentially caused them to lose millions of Dollars.
A spokesperson from Binance stated that their form will not be making any comments regarding the legal matters that are pending. What’s more, Liti Capital claimed that it planned to offer an initial sum of 5 million for pursuing all of the claims made against the crypto exchange. It planned this pursuit to make sure that the traders who were impacted because of the outage were taken care of in the right way.
The chief executive of Liti Capital claimed that the crypto exchange they are taking legal action against does not have any formal headquarters despite having its registration in Cayman Islands. He further went on to say that Binance made a model that caused a fair bit of difficulty when it came to the redressing of customers.
Incidents like these have been quite prevalent in the world of crypto and will continue to happen in the time to come. However, the one Binance has to deal with seems like a big deal and could make or break the crypto exchange. You can expect further developments to take place in the coming weeks and more traders to take action.