Binance Cryptocurrency Theft Lawsuit Revives After Court Rejects Arbitration Order
A federal appeals court has cleared the way for eight alleged victims of cryptocurrency theft to sue Binance in open court, delivering a rare legal setback to the world’s largest crypto exchange. The Binance cryptocurrency theft lawsuit had been stuck in arbitration limbo for months, even though none of the claimants ever agreed to Binance’s terms of use. Now, thanks to an unusual appellate order, their case is heading back to a federal courtroom in Florida.
Key takeaways
- The US Court of Appeals for the Eleventh Circuit granted a writ of mandamus on 19 August, overturning a lower court order that had forced eight crypto theft victims into arbitration with Binance.
- The claimants never signed up for a Binance account or agreed to its terms, yet a Florida judge compelled arbitration on 16 March 2026 anyway.
- The lawsuit accuses Binance Holdings, BAM Trading Services and founder Changpeng Zhao of RICO violations, consumer protection breaches, and running an unlicensed money-transfer operation.
- The appellate panel found the district court had “misread the complaints” and ruled the case will now proceed as litigation rather than arbitration.
Eleventh Circuit Allows Crypto Theft Victims to Sue Binance in Court
The core question here is simple: can a company force someone into arbitration under a contract that person never signed? According to the Eleventh Circuit, the answer is no — at least not under these facts. In a decision handed down in Miami on Wednesday, 19 August, the appeals court sided with eight claimants who say their stolen cryptocurrency was funneled through Binance, directing a district judge to scrap his earlier order compelling arbitration.
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