Binance and CZ Sued for $200 Million in UK Over ‘Unauthorized’ Derivatives Sold to 1,700 Traders

A Decade-Old Marketing Push Under Scrutiny

The claimants allege that Binance began marketing complex leveraged derivative products to UK retail investors in late 2019, roughly two years before the country’s Financial Conduct Authority (FCA) formally restricted retail access to such products in 2021. The suit, first reported by the Financial Times, seeks at least £150 million in damages.

A Binance spokesperson said the exchange would defend the claims “vigorously” and reaffirmed its commitment to complying with applicable laws. It bears mentioning that the company has faced a long series of legal and regulatory challenges across multiple jurisdictions but has repeatedly said it has overhauled its compliance program.

The High Court action names Binance Holdings Ltd, registered in the Cayman Islands, along with UAE-based entity Nest Exchange, Zhao (widely known as CZ) and several unnamed individuals. The investors argue that the derivatives were unsuitable for retail traders and were sold without the regulatory approvals required in Britain.

CZ’s Long Regulatory Shadow

The case revives legal pressure on a figure who has spent the past two years rebuilding his public image. As part of these efforts, Zhao first stepped down as Binance’s chief executive in November 2023, following which he was part of a $4.3 billion settlement with U.S. authorities. He pleaded guilty to money-laundering and sanctions violations and then served four months in a U.S. federal prison.

In October 2025, Zhao received a pardon from President Donald Trump. Since leaving day-to-day management (a role he has since ruled out returning to), he has advised roughly a dozen governments on crypto regulation and asset tokenization, launched the free education platform Giggle Academy, and continued backing startups through his investment firm YZi Labs.

What the Claim Could Mean

The UK case adds to a long list of actions Binance has confronted worldwide. A ruling that allows the claim to proceed could open the door to further retail lawsuits in Britain, where leveraged crypto derivatives remain banned for ordinary investors. Binance, now led by chief executive Richard Teng, has pointed to hundreds of millions of dollars in annual compliance spending as evidence of its reformed operations.

The claimants’ core argument is that the products were mis-sold years before the rules caught up, a timing question that could prove central to the case. Britain’s derivatives ban for retail investors took effect in 2021, but the alleged marketing began well before it, when oversight of crypto trading was thinner.

The coming few months will show how far UK courts are willing to hold offshore exchanges accountable for products sold to British retail traders before tangible regulations existed.