FTX has filed a lawsuit against Binance and its former CEO Changpeng Zhao for $1.8 billion, seeking to recover allegedly fraudulently transferred funds.
Details of the Share Repurchase Deal
FTX claims that Binance, CZ, and other Binance executives received $1.76 billion in FTX tokens (FTT) and Binance coins (BNB and BUSD) as part of a share repurchase deal in July 2021. The lawsuit alleges that the funds used in the deal were misappropriated from FTX customers and investors.
Allegations Against CZ and Binance
The FTX estate alleges that CZ's actions were part of a scheme to destabilize FTX. One focal point is a tweet from November 6, 2022, by CZ, announcing Binance's intent to sell its FTT holdings, valued at approximately $529 million. This reportedly triggered mass withdrawals and a liquidity crisis.
Lawsuit Against Waves Founder
In another legal move, FTX’s sister company Alameda Research has filed a separate lawsuit against Waves founder Aleksandr Ivanov, seeking to recover at least $90 million linked to Vires.Finance. Alameda claims Ivanov artificially inflated Waves' value.
The lawsuits against Binance and other crypto market participants highlight the complex legal and financial challenges FTX faces in its efforts to recover funds.
