Nearly 1,700 UK investors have sued Binance and founder Changpeng “CZ” Zhao in London, seeking at least £150 million, or about $200 million, over alleged unauthorized sales of crypto derivatives to retail customers.
The group claim was filed at the London High Court on June 30, 2026, by KP Law. The lawsuit alleges Binance offered high-risk products, including leveraged trading, futures, options, and leveraged tokens, to UK retail users without the required regulatory approval.
Binance said it would defend the claim. A company spokesperson told Reuters that Binance “remains committed to its obligations to users and to operating in accordance with applicable law.”
UK Investors File Group Claim Against Binance
The lawsuit names Binance Holdings Ltd, founder Changpeng Zhao, UAE-registered Nest Exchange Limited, and unnamed individuals alleged to have operated parts of the Binance trading platform. The claim covers activity from late 2019 onward.
KP Law described the case as the first UK action of its kind involving the alleged unauthorized sale of crypto derivatives to retail investors. The firm said some claimants suffered losses ranging from tens of thousands of pounds to millions.
The legal claim relies on alleged breaches of the Financial Services and Markets Act. The UK law restricts regulated financial activity by firms that do not have approval from the Financial Conduct Authority.
The FCA’s public register states that Binance is not currently permitted to conduct regulated activities without prior written consent. It also warns that consumers may not have access to UK compensation schemes if problems occur.
FCA Crypto Derivatives Ban Remains Central
The case also comes against the background of the FCA’s crypto derivatives ban. The regulator announced in October 2020 that crypto derivatives and exchange-traded notes tied to unregulated crypto assets were not suitable for retail consumers.
That ban took effect on January 6, 2021. Claimants argue that Binance’s later steps did not fully remove retail access to high-risk leveraged products.
The FCA recently said crypto assets remain high-risk investments under its rules. The regulator has lifted the ban on retail access to some exchange-traded notes, but it continues to review its position on retail access to derivatives.
Early stages of the High Court case are expected to deal with jurisdiction, the scope of alleged FSMA breaches, and whether the claim can move toward trial.
Binance Faces Wider Europe Regulatory Pressure
The UK lawsuit comes as Binance faces fresh regulatory pressure in Europe. The exchange withdrew its MiCA license application in Greece last week and said it would seek authorization in another EU member state.
Source: X
Without a MiCA license, Binance cannot offer certain crypto services across the European Union after the July 1 deadline. Binance said affected users will still have access to options already communicated to them, including transfers and withdrawals where applicable.
Binance said in a post that user assets remain safe and held on a 1:1 basis. Binance CEO Richard Teng also said the exchange is working with regulators and will contact affected users directly about next steps.
The company has pointed to its compliance spending as part of its response to regulatory scrutiny. Binance said it spends around $300 million a year on compliance and employs nearly 1,500 compliance staff.
OKX CEO Questions Binance Regulatory Record
OKX CEO Star Xu criticized Binance’s regulatory approach in a post on X. He questioned whether regulators in the UK, Singapore, and Europe would invite Binance back or allow it to acquire licensed companies.
Xu said, “Safeguarding customer funds is not something to boast about every day. It is a basic requirement for any platform.” He also compared regulatory arbitrage and ignoring laws to “dangerous FTX patterns.”
His comments were made as Binance supporters pointed to past examples in Japan and Singapore. Zhao has argued that Binance has faced regulatory setbacks before and later returned through licensed structures.
