A court in Sao Paulo, Brazil has ruled against a major cryptocurrency exchange in a case related to the withdrawal of funds from the platform. The user was awarded nearly $2,000 in damages and the deposited funds, in the court’s decision from September.
Binance Found Liable for Withholding Crypto Funds
Cryptocurrency exchanges have been under scrutiny in court cases in Brazil. Binance, one of the leading digital asset platforms, lost a case due to its inability to process withdrawals. According to reports, the lawsuit was filed in response to a client’s complaint that the exchange failed to process a withdrawal of almost $14,000 during a period when Binance had suspended direct withdrawals and deposits in the country.
The plaintiff argued that the funds were meant to be used for health expenses. The court ruled in favor of the client and ordered the exchange to execute the pending withdrawals. It also awarded nearly $2,000 in moral damages. The judge, Rafael Almeida Moreira de Souza, stated:
Values are essential for the survival, with dignity, of the applicant. The moral damage repair should compensate the victim, and punish the offender to ensure that similar acts are not repeated.
Local newspaper Metropoles reported of a similar case from December 2021, when a judge ordered a crypto exchange to permit a user to withdraw funds that had been frozen due to their connection to hacking attacks.
Capitalism Fails to Protect Cryptocurrency User
The root of the case against Binance was taken in June when Capitual, the exchange’s payment processor in Brazil, stopped processing orders. Binance had to update its platform to meet the new requirements set forth by the Central Bank of Brazil, which allowed third parties access to its PIX payment network to perform transactions.
The suspension lasted for over a week and was eventually concluded when a new temporary payments partner, Latam Gateway, was listed. Binance also considered the possibility of acquiring Sim;paul Investimentos, a Brazilian brokerage firm that is regulated.
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