According to media reports today, Binance.US has lawsuit against it, over its involvement in the sudden crash of stablecoin, Terra UST which led to the loss of billions by a large number of investors around the globe.
Binance.US Allegedly Gave Misleading Information
Since hitting its all time high last November, the value of Bitcoin has fallen drastically and along with it, the value of other digital assets; altcoins and stablecoins, resulting in the loss of investors’ assets, estimated to be worth whooping millions.
The greatest loss was perhaps caused by the fall of Terra UST, a stablecoin which lost its pegging to the US dollar. Terra UST boasted a large number of investors who confided in the founder’s words of maintaining stability and pegging till the end of time.
Despite his bold claim, the stablecoin lost its value and was depegged after falling below the $1 value mark. In their defense, a number of investors claim they were misled by the information they held. Binance.US have been accused of contributing to such information.
The US-based platform has been accused of painting a false image of the stablecoin to the public, as mentioned in the first Terra related lawsuit in the States, filed by Roche Freedman LLP. They claim Binance U.S isn’t registered, with CEO, Brian Shodder, targeted too.
South Korea Investigating Reasons Behind Terra’s Crash
The fall of Terra has been the most discussed subject of this crypto winter, after it went from being the world’s third largest stablecoin to being valued at less than a dollar. Do Kwon, owner and founder of Terra has also been heavily criticized.
Terra had a promise of an all time stability, according to Kwon, and while there were speculations of falsehood by few analysts, the founder insisted on his words and played down such speculations, one time calling them ‘poor’.
Investigations have since begun with South Korea, Kwon’s birth country, at the forefront. Last month, there was a move to summon him to Congress to explain the real reason behind the sudden crash of the stablecoin which led to millions of dollars in losses.
South Korean regulators and government are out to discover whether the crash was a purposeful act and are already working with the US to find solutions.
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Source: https://coingape.com/lawsuit-filed-against-binance-us-did-binance-mislead-investors-in-terra-ust-crash/