A Binance customer being wronged by one of the leading cryptocurrency exchanges attract fence-sitters which clouds the issue. Binance has performed exemplary well over the past years and even now, and yet, complaints about the exchange requiring an NDA (non-disclosure agreement) are worth looking into. Facts presented are pieced from sketchy details from the Reddit thread.
Customers lost a lot of money by whose fault?
Various errors in an exchange may occur, and Binance customers tend to lose a lot of money. If these are admittedly the error of the exchange, who must be made to bear the losses occurring from that error? This seems to be the bone of contention in this complaint from several customers who felt they were treated unfairly.
The complainant, Wellington20222 started the Reddit thread:
Binance is making many people sign NDAs and giving compensation of less than 5%.
He apparently lost $12k due to an issue within the futures app. This issue was never resolved and he was forced to accept a minor gift of 350USDT. He was also required to sign an NDA but did not.
He sent many tickets, and Binance responded only after two months and admitted the loss was brought about by a mistake. He also cited complaints from other people who were also made to sign an NDA after compensations of $350 – $400 for amounts ranging from $10,000 to $12,000 investment.
BTC tanked and the bear price moved with it instead of behaving like it should. Binance later acknowledged the mistake and immediately removed the pairs. This person was in Limbo for months until he gave up and signed the NDA. He isn’t alone in this matter around 100 people were contacted by Binance and forced to sign the NDA.
Wellington20222 also said that another Binance customer suffered from the same issue, a loss of $12k, and had been offered $350 as restitution. This might be hearsay perhaps but in social media, if anything is repeated too often, it becomes the truth.
Another side of the Binance customer complaint
Another perspective would be:
What’s undeniable is that Bull/Bear tokens are short-term trading instruments and WILL make you lose your money if held any longer than a week. They are a token that is supposed to mimic a leveraged position without ever liquidating. Do you think this comes without any drawbacks? Or did you never really question it and just bought in without reading/understanding the specifications?
Wellington20222 had put a sell order and checked months later only to realize it didn’t trigger. Binance was at fault, but the customer was also negligent. After placing that order, he should not just expect it to be filled, “months later after several system maintenances, in a risky market, without ever checking on it along the way.”
Binance issued a waiver on the matter of the Bear/Bull token as a response to the complainant:
We do not control the prices, nor the market, in any way — they are issued by FTX. With that said, it became clear not long after the BEAR/BULL tokens were listed that a large number of customers were struggling to understand how the tokens work, despite our attempts to educate. Furthermore, an unexpected shift in the market, which was not caused by Binance, led to losses for a number of our customers. Taking into consideration the trouble that customers were experiencing with the tokens, we made the decision to remove them from our exchange.
At the end of the explanation is a lesson for all investors:
While it is certainly unfortunate that customers have experienced losses, Binance is unable to simply bear the burden of every bad trade or a market issue. We have always made every effort possible to do best by our customers, and we will continue to do so. We aren’t perfect; we certainly do make an occasional mistake, and if there is clear evidence that we are responsible for a loss, we will address it accordingly.
There’s a lot to be said for investments but primarily, one should invest only in something he fully understands. Losses incurred might as well be charged to experience. But about NDAs, that is something else one should carefully think about before signing as it will limit options to prosecute one’s aggressor.
Take this warning seriously:
Risk warning: Cryptocurrency trading is subject to high market risk. Please make your trades cautiously. Binance will make best efforts to choose high-quality coins, but will not be responsible for your trading losses.
This post was last modified on May 12, 2020 9:01 pm