Another day in crypto nearly always means a day of chaos.
What’s new? Binance is pushing back hard against a $1.76 billion lawsuit from the FTX estate, calling the case legally flawed and factually off-base. In a new court filing, the crypto exchange argues that FTX is just looking for someone else to blame – and Binance refuses to play along.
If you’re lost about where this all is stemming from, we’ve got you covered. Read on.
FTX Wants Its Billions Back – Binance Says Not So Fast
This lawsuit goes all the way back to a 2021 deal where FTX bought back a 20% stake it had previously sold to Binance. The price? Roughly $1.76 billion in BNB, BUSD, and FTT tokens. FTX now claims it was already insolvent at the time and used customer funds to finance the buyback.
But Binance’s lawyers say that theory doesn’t hold up.
They argue FTX continued running its business for more than a year after the deal – hardly the behavior of a company already in collapse. The filing called the suit an attempt to rewrite the story and ignore that FTX’s downfall stemmed from “one of the most massive corporate frauds in history.”
This is clearly a not-so-subtle nod to Sam Bankman-Fried, who’s now serving 25 years in prison for defrauding customers and investors.
The CZ Tweet Gets Dragged In Again
FTX’s legal team is also pointing fingers at a now-famous tweet from former Binance CEO Changpeng Zhao. On November 6, 2022, CZ announced that Binance would liquidate its FTT holdings, citing “recent revelations.” That tweet, according to FTX, sparked a wave of customer withdrawals and helped tip the platform over the edge.
Binance says the tweet was based on public information – specifically the CoinDesk article that exposed Alameda’s shaky finances. And they’re not buying the idea that a single post caused the collapse. The motion argues there’s nothing to suggest CZ was lying or trying to tank FTX.
“The November 2022 tweets were posted in the days following a bombshell report by CoinDesk that blew the lid off of FTX’s facade, and the complaint contains no facts to suggest that the tweets were false,” Binance wrote, defending the tweets.
No U.S. Base, No Jurisdiction
Beyond the claims themselves, Binance says the case shouldn’t even be heard in a U.S. court. Its corporate entities aren’t based in the States and didn’t handle the transfers directly. The filing also leans on safe-harbor rules and says state-level claims don’t belong in bankruptcy court.
For now, Binance wants the whole case tossed out. FTX, meanwhile, is continuing its broader effort to claw back billions in assets and is preparing to pay out $5 billion to creditors in a second round of repayments starting May 30.
But this $1.76B fight is far from settled – unless the court agrees to shut it down completely.
