French investors are suing Binance for crypto promotions
Please note that we are not authorised to provide any investment advice. The content on this page is for information purposes only.
Binance previously got into quite a bit of trouble after it was discovered that it had been offering services and/or products in areas where it lacked the appropriate licenses to do so. Since then, the exchange has done a lot of work to hire compliance experts, obtain licenses, and ensures the legality of everything that it does.
However, its past actions seem to have far-reaching consequences. Right now, a group of French investors who previously used the exchange, decided to file a complaint against it. They are accusing the exchange of illegally promoting its services in the country before it received permission to do so.
French investors sue Binance for illegal promotions
According to investors, the period that Binance spent promoting its services started on December 19th, 2020, ending on May 4th, 2022.
The lawyers involved with the case have stated that Binance is being accused of misleading commercial practice. The investors claim that they lost more than 2.4 million euros due to the TerraUSD/LUNA collapse, and the reason why they invested in it is the fact that Binance promoted the token, claiming that it was backed by USD.
Binance officially obtained a license to offer digital assets services in May 2022, when the French regulator, the Financial Markets Authority (AMF) provided it
Binance denies the accusations
Binance responded to the accusations in a blog post, stating that it never carried out any promotional communication in France, at least not during the period that the plaintiffs have mentioned.
The investors also indicated that the exchange used a Telegram channel called Binance French to share posts about its various activities. The exchange addressed this as well, saying that it had never promoted crypto services in France before being allowed to do it. As for Telegram groups, they are considered global community forums, according to Binance. Any user can create or join such groups voluntarily.
Since May, Binance was officially allowed to operate in France, and it continued to expand to additional markets throughout the year. Recently, reports also suggested that the exchange is trying to obtain a license in Germany, and that it is currently discussing the possibility with the country’s Federal Financial Supervisory Authority (BaFin).
Back in May, Binance also received permission to offer its cryptocurrency services in Italy. The country’s financial regulator, Organismo Agenti e Mediatori, gave it green light to do so almost at the same time as the French authority. Then, about a month later, in June, Binance got the same permission from the Spanish authorities.