Finder makes money from featured partners, but editorial opinions are our own.

11 cryptocurrency firms hit with coordinated lawsuits


Picture not described

Allegations of illegal securities sales are visiting some of the biggest names in cryptocurrency.

Eleven class action lawsuits were filed against cryptocurrency companies on 3 April. The companies in the crosshairs include Binance, Civic, BPROTOCOL, Status, EOS parent company, KAYDEX, Quantstamp, BiBox, TRON Foundation, KuCoin and BitMEX.

Several of their principals were also named, including Brendan Blumer, Dan Larimer, Arthur Hayes and Changpeng Zhao.

These lawsuits were filed by the same law firm that brought you great hits such as Kleiman vs Wright, the World vs Bitfinex and "It's Starting to Feel A Lot Like Securities Fraud".

When first spotted by Offshore Alert, the site described it as the cryptocurrency industry's Red Wedding, in reference to the Game of Thrones episode in which a partnership disintegrates after one of the partners is shown to be operating on outdated KYC information.


On the one hand, these lawsuits are not unusual. It's a running theme in the cryptocurrency space that as soon as a token loses enough value, disgruntled buyers start saying they should get their money back because they should not have been allowed to buy it in the first place.

On the other hand, this volley of lawsuits could be a biggie.

"My assessment at the outset is that the merits of these cases are non-trivial," writes Stephen Palley at The Block. "Time will tell, and it will take some time for them to be resolved, but that will certainly happen. This development, any event, will likely keep a large number of lawyers busy for years to come and could be a harbinger of similar lawsuits to come."

"Of course, it's hard to summarize 11 detailed complaints but the key issue at play is the nature of these tokens as securities and their availability for purchase to U.S. persons."

In the spotlight

Some of the companies named in the lawsuit stand out for different reasons. TRON could be one of the highlights because, according to the suit, its whitepaper explicitly claimed that TRX tokens are not a security, while Justin Sun repeatedly promoted TRON as being better than Ethereum.'s EOS may be in a similar boat. Like TRON, it advertised its token very heavily even without a working product and without the token really doing anything. EOS recently settled its illegal security sales allegations with the SEC for $24 million. That settlement is also mentioned in the suit against

On the exchanges front, the allegations are also not entirely new.

Binance, KuCoin and many other exchanges have gone well out of their way to avoid serving US customers but still found themselves being named in these suits.

While the topics of these class action suits aren't entirely new, it's a sizable legal load which could help shape expectations of crypto companies going forwards.

It could take some months or even years though, and who knows where everyone involved will be that far down the line.

Also watch

Disclosure: The author holds BNB and BTC at the time of writing.

Disclaimer: This information should not be interpreted as an endorsement of cryptocurrency or any specific provider, service or offering. It is not a recommendation to trade. Cryptocurrencies are speculative, complex and involve significant risks – they are highly volatile and sensitive to secondary activity. Performance is unpredictable and past performance is no guarantee of future performance. Consider your own circumstances, and obtain your own advice, before relying on this information. You should also verify the nature of any product or service (including its legal status and relevant regulatory requirements) and consult the relevant Regulators' websites before making any decision. Finder, or the author, may have holdings in the cryptocurrencies discussed.

Latest cryptocurrency news

Picture: Shutterstock

Get started with crypto

Ask an Expert

You are about to post a question on

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms of Use, Disclaimer & Privacy Policy and 6. Finder Group Privacy & Cookies Policy.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.
Go to site