Binance Challenges $1.76B FTX Lawsuit, Alleges Fraud by SBF
Binance, the global cryptocurrency exchange, has filed a response to a $1.76 billion lawsuit brought by FTX, the embattled crypto exchange. In a legal motion, Binance's legal team, led by founder Changpeng Zhao (CZ), argues for dismissal of the lawsuit primarily on jurisdictional and substantive grounds.
The dispute centres around transactions that took place offshore, with Binance's corporate entities incorporated in Ireland, the Cayman Islands, and the British Virgin Islands. The transactions were mainly facilitated through Alameda Ltd., based in the British Virgin Islands. Binance's defense states that neither Zhao nor the exchange is based in the U.S., and therefore, U.S. bankruptcy laws do not apply extraterritorially to these transactions.
Zhao also challenges the court's authority to hear the case in Delaware, arguing improper service of process and that the claims are "so far removed" from the U.S. to apply relevant statutes.
Binance contends that the lawsuit is "legally deficient" and baselessly attempts to blame Binance for FTX’s collapse. Zhao describes himself as a “nominal counterparty," not the principal actor in the disputed transactions. Binance and FTX had ended their business relationship well before FTX's collapse, and the sale of Binance’s FTT holdings happened well after their partnership ended.
The legal motion characterizes the lawsuit as an attempt by the FTX bankruptcy estate to shift responsibility for the collapse onto Binance and its leadership, which they deny. Binance emphasizes the offshore nature of the transactions and the lack of nexus to U.S. law or both Zhao personally and Binance entities.
Binance's filing also argues that there is no evidence to suggest that they had any intention of acting otherwise regarding market impact. The decision to liquidate the exchange's remaining FTT holdings was driven by newly surfaced information, specifically a CoinDesk report revealing details about Alameda Research's balance sheet.
Binance denies the accusation, stating that FTX continued to operate as a going concern for 16 months following the deal. The lawsuit, according to Binance, is heavily influenced by the assertions of a "convicted fraudster." The legal battle between Binance and FTX continues, with both parties presenting their arguments in court.
Read also:
- Social Security Administration Abandons Plan for Electronic Payments: Important Information for Recipients of Benefits
- AI-Powered Transportation Stock's Possible Challenge to Tesla's Autonomous Dreams?
- Giant Luxury Yacht from Lürssen Company Capable of Navigating 1,000 Nautical Miles on Electric Power Solely
- Investment Firm, MPower Ventures, Obtains $2.7 Million in Capital to Broadens Solar Power Offerings Throughout Africa
