Hex crypto truther wants to sue Binance execs — but he can’t find them

Turns out, claiming to have no headquarters and refusing to answer questions about their location makes Binance execs difficult to sue.

A plaintiff suing Binance said they’ve taken “extensive action” to locate Binance execs Changpeng Zhao, Ted Lin, Catherine Coley, and Yi He but come up with little, describing them as “international ghosts.”

He even resorted to attempting to serve the Binance execs with his lawsuit over Twitter. A judge refused to approve that service as proper.

Indeed, claiming to have no headquarters and dodging questions about their location has made Binance executives very difficult to sue.

Zhao has refused to step foot on US soil for years. During the final minutes of a 2018 interview with Laura Shin, Zhao awkwardly identified his location as “Asia.” He frequently declines invitations to US conferences.

Entering the US allows process servers and federal authorities to serve court documents. Although international service is possible, a judge must first authorize it as proper to proceed with a US lawsuit.

Many international business people have been served — and even arrested — on airport tarmacs.

Private investigators couldn’t find Binance execs

Plaintiff Ryan Cox filed his lawsuit, a class action, in Arizona District Court on September 13, 2021.

Cox alleges that crypto price aggregator CoinMarketCap suppressed the reported value of notorious ‘Ponzinomics‘ token HEX in favor of Binance’s native Binance Coin (BNB). A Binance subsidiary acquired CoinMarketCap in 2020.

CoinMarketCap has, to this day, locked HEX at rank #201 by market capitalization and has “refused to adjust it on the basis of HEX’s performance as related to other cryptocurrencies ever since,” according to the suit.

CoinGecko displays data and charts for HEX but doesn’t rank it by market cap alongside other cryptocurrencies. Both moves effectively make it impossible for HEX to appear on the front page of either site.

HEX’s current market cap is $66 billion, which would make it the fifth most-valued cryptocurrency — ahead of Solana and behind only stablecoin Tether, Binance Coin, Ethereum, and Bitcoin.

Leading price sites CoinMarketCap and CoinGecko don’t rank HEX at its appropriate position.

HEX encourages investors to stake their cryptocurrency for long periods of time. It scales rewards, paid in HEX, to the length of commitment (maximum stake length is around 15 years).

The project and its native token don’t generate anything of value beyond token-denominated staking rewards. Scarcity is implied to increase as more investors lock their tokens away, and the price rises as more people buy in.

One commentator labelled these rewards HEX’s way of “fooling users into thinking that inflation is a payment rather than a tax.”

The project’s apparent success is enigmatic. HEX’s price is up over 4,000% in the past year, and at its September peak it had surged over 9,000% — far eclipsing Bitcoin and Binance Coin.

All this transforms project ringleader Richard Heart into a walking, talking, watch-sporting altar for FOMO — the ‘Fear of Missing Out.’

HEX is crypto’s most ‘valuable’ LARP

Heart regularly dismisses claims that HEX is a Ponzi scheme with catchy strawman arguments that suggest almost everything else in the world is a Ponzi, too.

“There’s a conspiracy afoot,” said Heart via direct message, referring to HEX’s permanent ranking at #201 on CoinMarketCap. “Funny how the price keeps going up, and the market cap keeps going up, but the rank don’t go up.”

As ClassAction.org pointed out, the suit cites an article from industry insider Nic Carter that details the “under-reported underbelly of the relationship between exchanges, coin ranking sites and retail investors.”

The class action describes conspiratorial an effort between Binance, CoinMarketCap, and its owners that lends itself to the exploitation of crypto investors.

Defendants include CoinMarketCap OpCo LLC, Binance Capital Management Company Limited, BAM Trading Services, and Binance executives Changpeng Zhao, Catherine Coley, Yi He, and Ted Lin.

“It’s really easy to multiple price times supply. They have no problem doing this for numerous scams that have come and gone and robbed everyone,” remarked Heart.

“You should probably ask people doing their job poorly, why they do their job poorly.” Protos has reached out to CoinGecko and CoinMarketCap for comment.

HEX is nearly twice the size of XRP… technically.

There’s however doubts about the efficacy of the alleged conspiracy to suppress HEX. Heart recently told Protos the average stake time is 5.7 years, up from 4.8 years in 2020.

In any case, process servers and private investigators have been unable to locate Binance execs named in the suit, so the class action is stuck in limbo.

US Judge Susan M. Brnovich nixed Cox’s plan to serve docs via Twitter on the grounds that it might violate international law.

In the ruling, she said, “[Cox] has not presented the court with enough information to determine the country in which defendants reside.”

This issue made it difficult to determine whether serving papers over social media would be legal. Brnovich did acknowledge the extreme difficulty in locating the Binance execs.

Binance and regulatory arbitrage

Zhao has repeatedly refused to reveal a location of Binance headquarters, implying that it has no permanent offices.

“Wherever I sit is going to be the Binance office. Wherever I need somebody, is going to be the Binance office,” he told an audience at the Ethereal Summit via web conference.

Binance’s ephemeral HQ isn’t to be confused with that of its US subsidiary Binance.US, which is headquartered in San Francisco.

Binance.US supports only a fraction of the digital assets and derivatives of Binance’s global, flagship exchange, which has purportedly decentralized so much that it has transcended mortal concepts of jurisdictions.

With this in mind, Zhao’s choice of home may provide a clue to the movements of Binance’s headquarters. He founded Binance Holdings in China in 2017 (after he left China’s OKCoin).

Zhao later claimed to be leaving China due to regulatory warnings. Over the years, Binance has opened offices in Shanghai, San Francisco, Seoul, Kampala, George Town, Saint Helier, Vaduz, and Tokyo.

Despite his hesitation to disclose his location, Zhao recently announced that he bought an apartment in Dubai. He describes his new home “pro-crypto.”

He admitted interest in moving to the Middle East during an interview at the Bloomberg New Economy Forum in Singapore. The United Arab Emirates has accommodative regulations for digital asset businesses.

Zhao recently conceded that a centralized headquarters might be necessary to interact with regulators.

Read more: [Binance staff exploited users’ crypto trades for personal gain, whistleblower]

Over the past couple years, Singapore has been Zhao’s primary residence and, by way of Zhao’s own logic, Binance’s de facto headquarters (Binance has however opted for Hong Kong to govern its terms of service).

Singaporean authorities are now forcing Binance to cease most of its activities in the country, although Zhao said he will not abandon Singapore altogether.

As a result, Binance’s Singaporean Dollar-to-crypto exchange, Binance.sg, will shutter by February 13, 2022. Binance.sg only supports spot trade for eight cryptocurrencies.

Binance applied for a license to open an office and crypto exchange in Indonesia earlier this week.

Someone tell Cox’s private eyes.

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