In brief
- The UK appeals court has dismissed the bulk of a $13.3B class action against Binance, rejecting claims that BSV could have reached Bitcoin-level value if not delisted in 2019.
- The court ruled damages were speculative and unsupported, saying that investors had a duty to mitigate losses by selling in an open market.
- The scope of the lawsuit was significantly narrowed, though smaller claims from investors who lost access or sold at a loss may still proceed.
The UK Court of Appeal has dismissed the majority of a $13.3 billion (£10 billion) class action against crypto exchange Binance, dealing a major blow to Bitcoin SV (BSV) investors who said the company’s 2019 delisting of the token crushed its growth potential.
The court rejected the investors’ “foregone growth effect” theory, which suggested BSV would have reached price levels similar to Bitcoin had it not been removed from major trading platforms, in a judgment handed down on Wednesday.
The claim sought 352 times the original value of BSV held by “sub-class B” investors, but the court deemed it speculative and ruled it could not proceed.
“I asked Mr. John Wardell KC… how the representative could possibly claim hundreds of times more than the value of the assets that the defendants had allegedly damaged,” wrote Master of the Rolls Sir Geoffrey Vos in the ruling. “He was unable to give any answer.”
Wardell, a senior barrister at Wilberforce Chambers, represents BSV Claims Limited, the entity bringing the collective action on behalf of over 240,000 UK-based investors.
Last week, his team asked the court to revive the dismissed claims, including a “loss of chance” theory.
The Court found that the claimants’ own expert had relied on comparators like Bitcoin and Bitcoin Cash to estimate damages, undermining the argument that BSV was a unique or irreplaceable asset.
It also dismissed the “loss of chance” claim, ruling it was not legally applicable.
The judges explained the damages sought did not involve missed opportunities tied to third-party decisions or realistic probabilities.
Instead, the claim turned on whether BSV would have developed into a top-tier cryptocurrency, a question the Court said could be resolved on the balance of probabilities and not through speculative or fallback theories.
In doing so, the Court affirmed the Competition Appeal Tribunal’s July 2024 decision, which applied the “market mitigation rule,” a legal principle requiring claimants to take reasonable steps to reduce their losses when a functioning market is available.
Decrypt has reached out to Binance for comment and will update this story should the exchange respond.
Lawsuit narrowed
The judgment narrows the lawsuit, which also targets Kraken, ShapeShift, and Bittylicious over their 2019 delistings of the BSV token.
The BSV token, the full name of which is Bitcoin Satoshi Vision, was created by Craig Wright, whose claim to be Bitcoin creator Satoshi Nakamoto was dismissed by a UK court earlier this year.
While the Appeal Court dismissed the largest part of the lawsuit against Binance, some smaller claims could still move forward.
These include claims from investors who lost access to their BSV after it was removed from exchanges, or who sold it at a loss soon after the delisting.
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