The U.S. Supreme Court has denied Binance and its former CEO Changpeng Zhao's petition to review a ruling affirming that U.S. securities laws apply to the cryptocurrency exchange.

This ruling allows a class action lawsuit to proceed against Binance, filed by former investors who accuse the exchange of illegally selling unregistered tokens that subsequently lost value.

Legal troubles for Binance escalated in mid-2023 following a lawsuit from the Securities and Exchange Commission over the sale of unregistered securities.

The 2nd U.S. Circuit Court of Appeals previously ruled that U.S. securities laws apply to Binance, citing that token purchases became irrevocable in the U.S. upon payment.

In its appeal, Binance argued that the 2nd Circuit misapplied the Morrison decision, which they claimed limited the application of U.S. securities laws to transactions conducted outside the U.S.

Despite these arguments, Binance maintains that the accusations against it are baseless and asserts that its operations outside the U.S. should exempt it from U.S. securities laws.

This case is separate from Binance's November 2023 guilty plea to federal anti-money laundering violations, which resulted in a $4.3 billion penalty.

Zhao served a four-month prison sentence related to these charges before being released in September 2024.

In addition to the U.S. legal challenges, Binance is also facing a class action lawsuit in Canada for alleged securities law violations.

Moreover, the FTX bankruptcy estate is suing Binance and Zhao for $1.8 billion over a disputed share deal from 2021.

Binance's appeal raised concerns about the broader implications for foreign trading platforms regarding the applicability of U.S. securities laws.

The Supreme Court's recent decision to allow a shareholder lawsuit against Nvidia to advance may indicate a trend that could affect Binance's legal standing.