Binance Tries Again to Move Securities Case Out of US Courts

This latest development is the latest chapter in a years-long legal saga that reached the Supreme Court, which declined to hear Binance’s appeal. Meanwhile, Coinbase is under investigation by the US Department of Justice after a data breach involving bribed customer support agents led to estimated user losses of up to $400 million. The breach also helped facilitate a number of scams, and triggered multiple lawsuits and intensified scrutiny from the SEC. In Australia, a court ruling may revolutionize crypto tax law by declaring Bitcoin a form of money rather than property. The ruling could potentially unlock up to $1 billion AUD in capital gains tax refunds. It is also expected that the decision could set a global precedent if upheld.

Binance Argues Lawsuit Must Go

Crypto exchange Binance renewed its push to move a US class-action lawsuit to arbitration, and recently pointed out that users agreed to waive their rights to sue as a group under its terms of service. In a May 16 filing to a federal court in New York, Binance argued that its 2019 Terms of Use include a binding arbitration clause, which should apply to all claims that arose after Feb. 20, 2019. The company also stated that these terms contain a class-action waiver that should cover all the plaintiffs’ claims. 

Part of Binance’s filing (Source: PACER)

This comes in response to a prior ruling by Judge Andrew Carter, who in March declined to send all claims to arbitration—particularly for users who bought digital tokens on Binance between April of 2017 and February of 2019. The judge also partially denied Binance’s arbitration request for post-2019 claims, pending further clarification on how broadly the arbitration clause should be applied.

In its latest argument, Binance said that its earlier terms of service already reserved the right to update the agreement without notifying each user individually. The crypto firm is pushing for the court to uphold the arbitration clause and enforce the waiver across all the relevant time periods.

The case has a long legal history. It was originally dismissed in March of 2022 after Judge Carter sided with Binance, which claimed it was not subject to US securities laws due to a lack of physical presence in the country. However, that decision was overturned by the US Court of Appeals for the Second Circuit in March 2024. Binance tried to appeal to the Supreme Court, which declined to take the case in January 2025.

Binance’s legal challenges in North America have intensified over the past two years. In June of 2023, the US Securities and Exchange Commission (SEC) filed a high-profile lawsuit against Binance for allegedly selling unregistered securities. That case was settled in November 2023 for $4.3 billion. In April 2024, Binance was also hit with a class-action lawsuit in Canada over alleged securities law violations.

DOJ Probes Coinbase Data Breach

Other crypto exchanges also find themselves in legal hot water. The US Department of Justice is reportedly investigating a data breach at Coinbase involving customer service agents in India who allegedly accepted bribes in exchange for giving criminals access to user information. 

The probe was first reported by Bloomberg on May 19, and it centers around a group of support contractors who were later terminated by Coinbase for abusing their system access. Coinbase publicly confirmed the breach on May 15 and said that it was working with the DOJ and international law enforcement agencies. Paul Grewal, the company’s chief legal officer, said that they were cooperiating and supporting the prosecution of the people who were involved. 

While Coinbase stated that no user passwords, private keys, or funds were directly exposed, the breach still facilitated a wave of social engineering attacks. One high-profile victim was reportedly a partner at Sequoia Capital. It is estimated that total user losses may have reached up to $400 million. To make things worse, the attackers demanded a $20 million extortion payment from Coinbase in exchange for silence, which the company refused to pay.

Coinbase’s response to the data breach (Source: Coinbase)

Naturally, the breach led to multiple lawsuits from affected users, with claims that Coinbase failed to adequately protect personal data. Among the plaintiffs is a retired artist, Ed Suman, who says he lost $2 million due to the scam. 

At the same time, Coinbase is also under regulatory scrutiny from the SEC, which is examining whether the exchange misrepresented its number of verified users. The combination of legal pressures and security concerns also led to volatility in Coinbase’s stock.

Court Shakes Up Crypto Tax Law in Australia

In the latest crypto-related legal development from Australia, a recent court ruling could reshape the country’s approach to cryptocurrency taxation, and potentially unlock hundreds of millions in capital gains tax (CGT) refunds for Bitcoin users. The decision came as part of a criminal case involving former federal police officer William Wheatley, who was accused of stealing 81.6 Bitcoin in 2019. 

William Wheatley

At the time, the digital assets were valued at approximately $492,000, but they are now worth over $13 million. In a landmark judgment, Judge Michael O’Connell of Victoria ruled that Bitcoin should be treated as a form of money rather than property, drawing parallels between the cryptocurrency and traditional Australian dollars.

This classification stands in stark contrast to the Australian Taxation Office’s long-standing stance. Since 2014, the ATO categorized cryptocurrencies, including Bitcoin, as CGT assets. Under this classification, any transaction involving the disposal of Bitcoin — whether it be a sale, exchange for another cryptocurrency, or use as payment for goods or services — constitutes a CGT event subject to taxation. The ruling, if upheld, will fundamentally challenge this framework by saying that Bitcoin operates as a monetary instrument rather than a tradable asset.

Tax experts believe the ruling could have far-reaching consequences. Adrian Cartland, a tax lawyer that was interviewed by the Australian Financial Review, explained that if Bitcoin is not considered a CGT asset, then buying and selling it would carry no tax consequences. He estimated that Australians could be entitled to as much as 1 billion Australian dollars in potential CGT refunds. However, the ATO did not specifically confirm this figure and hold firm that there are no official estimates regarding the scale of possible refunds should the ruling be upheld on appeal.

The outcome of any appeal could greatly impact not just Bitcoin holders but the broader legal and regulatory treatment of digital assets in Australia. Overall, the decision will be the start of a historic shift in recognizing cryptocurrency as money in the legal system, and it could inspire similar legal challenges to crypto tax regimes in other countries.