A group of British investors who claim to have lost more than US$13 billion after the removal of Bitcoin SV (BSV) from Binance in 2019 have filed a new lawsuit.
The goal is to restore the so-called “lost growth effect” claim, which was rejected last year by the Competition Appeal Tribunal.
According to the investors, the removal of BSV from the largest exchanges in the market prevented the digital asset from reaching its “true potential,” which would have caused irreparable losses to more than 243,000 British investors of the currency between April 2019 and July 2022.
The class action lawsuit, filed by BSV Claims Limited, claims that BSV would have become a top-tier cryptocurrency — “with a value close to that of Bitcoin itself” — if it had not been removed by exchanges such as Binance, Kraken, ShapeShift, and Bittylicious.
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The calculation of the compensation is based on the hypothetical appreciation of BSV until July 2022, when the lawsuit was initiated.
Court rejects claim, but investors insist on “permanent damage”
In July 2024, the Court of Appeals ruled that most investors could have mitigated their losses by exchanging their BSV for other cryptocurrencies, as provided by the “market mitigation rule.”
For the judges, there was not enough evidence that investors were unaware of the asset’s delisting or that they could not react in time.
However, the investors’ lawyers claim that the damage was inevitable, even for those who tried to sell.
“If the asset is already devalued, there is no way mitigation can work,” said John Wardell KC, legal representative of the group. “If it weren’t for the delisting, BSV would have achieved the status of a top-tier currency like Bitcoin itself.”
Binance, on the other hand, defended the previous decision, arguing that BSV has always been an easily tradable asset, which could be exchanged for Bitcoin or other cryptocurrencies on the secondary market.
BSV falling after Craig Wright’s judicial defeat
The legal dispute is aggravated by the involvement of Craig Wright, creator of BSV and a figure present in several controversies.
In early 2024, the UK Court concluded that Wright lied when claiming to be Satoshi Nakamoto, creator of Bitcoin. The decision had a negative impact on BSV, which plummeted 22% in a matter of days.
Ashley Fairbrother, a lawyer at Edmonds Marshall McMahon, acknowledges that the case is unprecedented in the UK and presents “extraordinary complexity.”
He states that Wright has already been found guilty of defrauding courts in multiple countries, including the USA, Norway, and the UK itself.
“If the currency was created based on fraud, it is understandable that exchanges have acted to protect the Bitcoin ecosystem.”
Class action could set legal precedent on cryptocurrencies in the UK
The lawsuit is the first class action in the UK involving cryptocurrencies and competition laws. If the investors win the lawsuit, the case could set a precedent for holding exchanges accountable for business decisions such as listing or delisting assets — something that has faced obstacles in courts until today.
Fairbrother, however, is skeptical: “Even if they have resources, any victory may end up indirectly favoring the interests of Craig Wright.”
The Court of Appeal has not yet released the final decision. The market awaits the verdict that could redefine the legal responsibilities of exchanges in the crypto ecosystem.
