Binance and its former CEO Changpeng Zhao are being sued by the collapsed cryptocurrency company FTX
The lawsuit alleges that $1.8 billion was “fraudulently transferred” by FTX management to Binance and its executives.
The lawsuit pertains to Binance’s sale of its stake in FTX, which it acquired in 2019 and subsequently negotiated to sell back to FTX in July 2021.
As per the lawsuit, FTX’s Alameda Research division directly funded the share repurchase using tokens with a fair market value of $1.76 billion. The lawsuit claims Alameda was insolvent at the time of the share purchase and, as a result, could not finance the transaction. Consequently, the lawsuit argues that the transaction should not have proceeded.
In a filing made on Sunday in the U.S. state of Delaware, the administrators for the FTX estate stated that the Plaintiffs are seeking to recover at least $1.76 billion that was fraudulently transferred to Binance and its executives at the expense of FTX’s creditors, as well as compensatory and punitive damages to be determined at trial, for the benefit of FTX’s creditors.
A spokesperson for Binance stated, “The allegations are without merit, and we will vigorously defend ourselves.”
“CZ” Zhao, commonly called Zhao, was unavailable for confirmation.
The lawsuit represents the most recent conflict between Binance and FTX.
Before its collapse in late 2022, FTX was one of the world’s largest cryptocurrency firms.
FTX’s non-U.S. unit was on the brink of being acquired by arch-rival Binance, which Zhao then managed as it struggled to remain afloat in November 2022. However, Binance withdrew its offer.
In March of this year, Bankman-Fried, the proprietor of FTX, was sentenced to 25 years in prison for stealing $8 billion from customers. He has filed an appeal against the conviction.
Following his guilty plea to violating U.S. laws against money laundering at the world’s largest cryptocurrency exchange earlier this year, Zhao was imprisoned for four months.
Spotify is improving the audiobook experience for premium users by implementing three new experiments: the addition of visuals that appear…
MARA Holdings has successfully concluded its $1 billion private offering, and part of the proceeds will be allocated to the…
Automattic, the owner of WordPress.com, has acquired Harper, a grammar-checking tool, to enhance its content creation capabilities Automattic, the owner…
Jessica Rosenworcel, the first female FCC chair, announced Wednesday that she will resign if Donald Trump becomes president In 2012,…
Threads is eventually making changes to the algorithmic feed to surface more content from the people you follow, following numerous…
The social media platform Reddit encountered an additional outage this morning at approximately 7 a.m. PT, following the one that…