The U.S. Supreme Court turned away on Monday a bid by Binance and founder Changpeng Zhao to avoid a lawsuit by investors who accused the world's largest cryptocurrency exchange of illegally selling unregistered tokens that lost much of their value.

Binance faces a setback as the U.S. Supreme Court denies its appeal, impacting BNB’s price and market sentiment.

The U.S. Supreme Court declined to hear Changpeng Zhao and Binance’s appeal against a 2nd Circuit decision. Binance submitted that United States securities laws did not apply to the company since its headquarters were not within the county. The 2nd Circuit Court ruled in March 2024 that Binance token sales were subject to domestic laws.

Malaysia’s Prime Minister recently held discussions with Binance co-founder Changpeng Zhao and UAE officials regarding the same.

The court’s decision allows a class-action lawsuit to proceed, finding that US securities laws apply despite Binance’s foreign operations.