Binance fails to deliver knockout blow to the £9.9bn bitcoin claim  

The first claim against cryptocurrency exchanges, brought by the ex-regulatory chief Lord Currie, is now set to go to trial

The Competition Appeal Tribunal dismissed the application of Binance, one of four cryptocurrency exchange operators who stand accused of colluding, to strike out the £9.9 billion claim. 

Speaking after the certification decision Lord Currie said:

‘This is a significant day for UK holders of BSV.  The CAT has decided that BSV Claims can argue its case that crypto asset exchanges are subject to the same competition laws as other businesses. 

‘BSV Claims hopes that this case will strengthen investor protection, as well as enhancing the UK’s status as a jurisdiction at the forefront of cryptoasset law.’

This is a blow for Binance who was the only defendant seeking to oppose certification of the claim. 

Four major cryptocurrency exchanges accused of colluding

A £9.9bn lawsuit claims four major cryptocurrency exchanges caused thousands of consumers to lose money they invested. Sign up to stay updated.

A lawsuit filed by Lord Currie of Marylebone against four major cryptocurrency exchanges – Binance, Kraken, Bittylicious and ShapeShift – on behalf of UK consumers. The exchanges stand accused of collusion, via a series of tweets, and delisting Bitcoin Satoshi Vision (BSV) in April 2019. This resulted in artificially driving down the value of BSV, both in the immediate aftermath of the delisting event and the lost opportunity for BSV to become a ‘top tier’ cryptocurrency, causing loss to holders of and investors in the coin. Following the delisting, the Binance and Kraken exchanges also seized some users’ BSV coins, meaning those users lost access to their coins. 

The first cryptocurrency claim is to go to trial 

The claim is against four crypto exchanges but other than Binance none of the other defendants participated in the certification process. Binance focused its objections on trying to strike out the claim rather than taking issue with the other certification matters. 

In contrast to recent certification hearings, where the funding arrangements of the claimant have dominated proceedings, no issues were formally raised. The Tribunal, however, did scrutinise the funding arrangements and made formal the offer by the funder, Softwhale, to comply with the funders Code of Conduct requirements on cash flow and capital adequacy, a condition of certification.

Binance lost its battle to strike out the claim. The basis for the strike out application by Binance was what has been referred to as the ‘market mitigation rule.’

Binance argued there was nothing preventing BSV holders from mitigating any future losses by selling their BSV coins after the alleged infringing events and purchasing other cryptocurrencies instead. It argued that any loss caused to people by holding onto their BSV coins isn’t something the Proposed Defendants should be liable for.

The Tribunal found that while it was reasonable for the holders of BSV coins to mitigate by reinvesting in other cryptocurrencies it wasn’t clear if they were aware of the delisting event. While the court wanted to examine these issues in greater detail ahead of trial they held they didn’t reach the bar to strike out the claim.

Binance was asked to comment. 

Are you one of the customers owed a share of the £9.9million?

You could be owed money if you owned Bitcoin Satoshi Vision (BSV) on 11 April 2019, and this includes those that sold or lost access to their coins at a later date. This is an ‘opt-out’ collective claim, meaning you are automatically eligible for compensation if you bought and owned BSV on 11 April 2019. Sign up to Consumer Voice to stay updated and to find out when you can claim.