More than 1,000 people in England and Wales have joined a group action legal claim against crypto trading platform Binance and its founder, Changpeng Zhao, in the first action of its kind in the UK. The claim now represents approximately 2,700 consumers globally, class action specialist firm KP Law said today. 

It made the announcement as the Financial Conduct Authority opened the authorisation gateway for the UK’s new crypto asset regulatory regime, designed to protect investors in the sector. Binance is expected to apply for a licence under the regime, which will come into force on 25 October 2027.

The group claim, filed in the High Court June, is brought on behalf of consumers who traded cryptocurrency derivative products on the Binance.com crypto platform, founded in China in 2017. The value of claims issued to date is estimated to exceed £250 million.

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The claimants allege that Binance sold high-risk, complex derivative and leveraged products to UK-based users of the platform without FCA authorisation. The products that are the subject of the claim involved the use of leverage to amplify gains or losses, and futures and options contracts, which allowed users to speculate on the future prices of cryptocurrencies.  

The claim argues that Binance, which has over 300 million customers globally, knowingly made these products available to UK users from late 2019 to early 2020.  The claimants contend that the products are specified investments within the scope of the Financial Services and Markets Act 2000 and should be sold only by authorised persons. 

Many of the retail invstor claimants suffered substantial losses as a result of transactions placed with Binance, losing tens of thousands and in some cases millions of pounds. 

KP Law partner Hannah Sharp said: 'It is public knowledge that Binance have failed to cooperate with regulators. That’s why their UK group company, Binance Markets Limited, was barred from regulated activity in the United Kingdom in 2021. Sadly, this prohibition did not stop Binance from selling our clients crypto derivative products we allege they were not at the time authorised to sell in this market.'