US judge blocks Binance arbitration in crypto loss suit

A US judge denied Binance's arbitration request, ruling users weren't properly notified of new terms. Pre-2019 claims over alleged unregistered token sales will proceed in court.

A federal judge has rejected Binance's attempt to compel arbitration in a lawsuit filed by US customers over losses from unregistered crypto tokens purchased before February 20, 2019. The court determined that Binance failed to adequately notify users about the addition of an arbitration clause and class-action waiver in its 2019 terms of use. As a result, claims related to transactions before this date will proceed in open court rather than private arbitration. The judge found that simply posting updated terms online was insufficient to bind users to significant changes, and deemed the class-action waiver ambiguous and unenforceable. Plaintiffs agreed to drop claims arising after February 20, 2019. The lawsuit, revived by appeals in 2024 after a 2022 dismissal, accuses Binance and its founder of violating securities laws by selling high-risk tokens without proper warnings. The case will now move forward in public court, focusing on Binance's conduct prior to 2019.