UK Court of Appeal Rules on Class Action Against Binance
In a significant legal ruling, the UK Court of Appeal has largely rejected a class action claim amounting to $13.3 billion (£10 billion) against the cryptocurrency exchange Binance, involving investors of Bitcoin SV (BSV). These investors contended that the removal of BSV from major exchanges in 2019 severely impacted its potential growth.
Judgment Dismisses Investor Arguments
On Wednesday, the court delivered its judgment, dismissing the investors’ argument centered on a supposed “foregone growth effect.” This theory asserted that BSV prices would have mirrored those of Bitcoin had it not been taken off prominent trading platforms.
The investors sought damages that were 352 times the initial value of their BSV holdings through a collective action led by BSV Claims Limited, representing over 240,000 investors from the UK. However, the court found this claim speculative and ruled that it was not sufficient to proceed.
Sir Geoffrey Vos, Master of the Rolls, highlighted a significant issue with the expert testimony provided, noting that the representative was unable to substantiate how damages could exceed the actual value of the assets potentially harmed.
Challenges to the “Loss of Chance” Argument
Despite the disappointing outcome, the legal team, led by senior barrister John Wardell KC, attempted to persuade the Court to revive their claims, which included a “loss of chance” argument. However, the judges concluded that this claim was not applicable under the law and pointed out that the evidence presented undermined the uniqueness of BSV as it compared the crypto asset’s potential against established cryptocurrencies like Bitcoin and Bitcoin Cash.
Furthermore, the judges emphasized that the damages sought related not to missed opportunities based on external decisions but hinged on the hypothetical progression of BSV as a leading cryptocurrency. The Court utilized principles established by the Competition Appeal Tribunal’s ruling from July 2024, which mandated that claimants must take reasonable measures to mitigate their losses when a viable market exists.
Remaining Legal Proceedings
Although most allegations against Binance have been dismissed, the lawsuit remains alive concerning smaller claims regarding investors who lost access to their BSV post-delisting or sold the token at a loss shortly thereafter. The legal proceedings also encompass other exchanges like Kraken, ShapeShift, and Bittylicious, which delisted BSV in 2019.
The BSV token, fully known as Bitcoin Satoshi Vision, was introduced by Craig Wright, who controversially claimed to be Satoshi Nakamoto, the enigmatic creator of Bitcoin – a claim that was ruled against by a UK court earlier this year.
As this situation unfolds, Decrypt intends to reach out to Binance for any comments and will provide updates should a response be received.
