The highest court in the United States, the US Supreme Court, has rejected the appeal of Binance and its former CEO Changpeng Zhao, to revisit a previous ruling by a lower court that the cryptocurrency exchange is subject to US securities laws.
This decision adds to the growing legal troubles facing the world’s largest cryptocurrency exchange. The case involves investors who purchased tokens such as ELF, EOS, FUN, ICX, OMG, QSP, and TRX through Binance in 2017.
They claim that the exchange did not properly disclose the risks associated with these tokens, and are seeking compensation for their losses. The 2nd US Circuit Court of Appeals in Manhattan ruled that Binance could be subject to US securities laws because the purchase of tokens became final in the United States when investors made payments.
The court also pointed to Binance’s use of servers in the United States through Amazon Web Services as a basis for its decision. Binance has argued that because its operations are primarily outside of the United States, it should be exempt from US securities laws.
