Price: $0.38703 -0.1779%
Market Cap: 56.85B 1.7621%
Volume (24h): 8.56B 0.4%
Dominance: 1.7621%
Price: $0.38703 -0.1779%
Market Cap: 56.85B 1.7621%
Volume (24h): 8.56B 0.4%
Dominance: 1.7621% 1.7621%
  • Price: $0.38703 -0.1779%
  • Market Cap: 56.85B 1.7621%
  • Volume (24h): 8.56B 0.4%
  • Dominance: 1.7621% 1.7621%
  • Price: $0.38703 -0.1779%
Home > Information news > FTX Sues Binance and CZ for $1.8B Over Fraudulent Transfer

FTX Sues Binance and CZ for $1.8B Over Fraudulent Transfer

Release: 2024/11/12 00:11 Reading: 686

Original author:TheNewsCrypto

Original source:https://coinmarketcap.com/community/articles/673226580bdd146a82f30f0d

FTX Sues Binance and CZ for $1.8B Over Fraudulent Transfer

FTX Lawsuit Alleges Fraudulent Share Repurchase Deal with Binance and CZ

FTX, the bankrupt cryptocurrency exchange, has filed a lawsuit against Binance and its former CEO, Changpeng Zhao (CZ), seeking to recover approximately $1.8 billion. The lawsuit, filed on November 10, alleges that this sum was received by Binance and CZ as part of a fraudulent share repurchase deal in July 2021.

Alleged Insolvency at Time of Deal

The dispute stems from an agreement in which FTX co-founder Sam Bankman-Fried repurchased stakes from Binance in 2021. FTX claims that this repurchase was funded using a combination of FTT, BNB, and BUSD tokens.

However, FTX alleges that both FTX itself and its trading arm, Alameda Research, were insolvent at the time. Consequently, the exchange argues that the transaction was fraudulent.

CZ's Alleged Role in FTX's Downfall

The lawsuit also accuses CZ of making damaging public statements that exacerbated the situation. Specifically, FTX claims that Zhao's tweets in November 2022, including one about Binance selling off its FTT holdings, triggered a massive withdrawal crisis at FTX.

This crisis led to a sharp decline in the value of FTX's assets, further destabilizing the exchange and leaving creditors with substantial losses. The FTX estate contends that these actions were intended to undermine FTX's market position and cause its collapse.

Binance's Response

Binance has not yet responded in detail to the lawsuit. However, a spokesperson has dismissed the claims as meritless.

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