Reuter quoted information from the litigation that Bian and his founder, Zhao Chang Peng, had been sued by an investor in the United Kingdom, claiming an amount of nearly $200 million. The focus of the case is on whether the Platform provides high-risk encrypted financial products to British users without appropriate regulatory approval.
Nearly 1,700 investors were listed as plaintiffs.
According to the report, the claim was approximately Pound150 million, or approximately $200 million. The number of plaintiffs was close to 1700, and involved losses for some investors after they came into contact with the products at the end of 2019.
According to the prosecution, Currency was providing British investors with complex and high-risk financial instruments, including leveraged traded products. These products were cited as unsuitable for ordinary retail investors and lacked the necessary regulatory licences.
Litigation focused derivative compliance
The British Financial Conduct Regulatory Authority (FCA) announced in October 2020 that it would ban the sale of encrypted derivatives to retail customers on the grounds that such products were too risky for ordinary investors. The ban entered into force in January 2021.
An overview of the encryption policy released by the FCA on Tuesday shows that regulators have recently eased access restrictions for retail investors to some of the encrypted exchange transactions (ETNs), but the position on retail access to encrypted derivatives is still under review.
Money is responding and facing European pressure.
The Franco-Ann spokesperson indicated to Reuters that the company would continue to fulfil its obligations to the users and would operate in accordance with applicable law, and would contest the action.
In addition to the British lawsuit, there has been resistance to the advancement of currency in European compliance. Last week, the company officially withdrew its application for a licence in the European Union Code for the Regulation of Encrypted Asset Markets (MiCA), submitted in Greece. Reuters had previously reported that the application would be rejected.
Additional information:The MiCA license plate is an important precondition for the provision of related services from the encryption platform in the EU member states as of 1 July. Currency has indicated that it will be reapplied by other EU member States, but no location has been specified.