The plaintiffs commenced a proposed class action against Binance for selling crypto derivatives products without filing a prospectus, contrary to the Securities Act.
Binance brought a motion to stay the action in favour of arbitration in Hong Kong, relying on an arbitration agreement in its online terms of service.
The court dismissed the motion, finding the arbitration agreement void ab initio as contrary to public policy and unconscionable, given the disproportionate cost of arbitration in Hong Kong compared to the average investor's claim and the inequality of bargaining power in the standard form 'click' contract.
