Binance and CZ Face New Class-Action Lawsuit Over Alleged Crypto Laundering

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Live Bitcoin NewsAug 23, 2024 6:15 AM

Binance and its former CEO, Changpeng Zhao (CZ), are facing a new legal challenge with a revived class-action lawsuit in the U.S. District Court for the Western District of Washington, Seattle. The lawsuit is filed by three cryptocurrency investors. It alleges that Binance facilitated the laundering of stolen crypto assets, making them untraceable. The plaintiffs state that to make things worse, their stolen cryptocurrency was sent to Binance, which ‘laundered’ the transaction, making it almost impossible to retrieve the stolen assets.

This lawsuit is just the latest legal headache for Binance, which has faced a $4.3 billion settlement with the U.S. Justice Department and the resignation of CZ after he pleaded guilty to violating U.S. money laundering laws for this platform. Legal analysts think that this case could have major consequences for the blockchain and cryptocurrency industry regarding the fields of blockchain investigation and on-chain asset reclaim.

Plaintiffs Accuse Binance of Blocking Blockchain Transparency in New Suit

The legal complaint alleges that Binance has committed a range of illicit actions that included violating the Racketeer Influenced and Corrupt Organizations Act (RICO). The plaintiffs claimed that since blockchain is transparent, it should have been easy to track the stolen assets but Binance interfered with this.

The plaintiffs said, “Without a place to launder crypto, such as Binance.com, if a bad actor steals someone else’s crypto, there is a risk the authorities would eventually track them down by retracing their steps on the blockchain.” The statement shows one of the important effects of the case on the industry – the issue of tracing stolen assets.

Binance has encountered several legal issues in the previous year. November 2023 – CZ is found guilty of money laundering and this results in his dismissal and a $4.3 billion penalty for regulatory breaches by Binance. Furthermore, in June 2023, the US Securities and Exchange Commission (SEC) sued Binance for civil securities fraud and inflating traffic volumes. The court allowed a significant portion of this lawsuit to proceed in June 2024.

The post Binance and CZ Face New Class-Action Lawsuit Over Alleged Crypto Laundering appeared first on Live Bitcoin News.

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