Binance has filed a motion in a Delaware court seeking dismissal of a $1.76 billion lawsuit filed by the FTX estate. The suit revolves around a 2021 equity buyback agreement between Binance and FTX, which the FTX estate alleges was funded improperly using customer assets, contributing significantly to FTX's eventual collapse.
Binance denies any wrongdoing, asserting that the lawsuit lacks sufficient evidence and legal grounds. The company emphasizes that the equity buyback deal took place over a year before FTX’s bankruptcy and argues that the real cause of the collapse was massive fraud committed by FTX’s former leadership, specifically the convicted founder Sam Bankman-Fried (SBF), who received a 25-year sentence for fraud and conspiracy.
Binance also rejects claims that it knowingly used misappropriated customer funds or participated in any fraudulent transfers related to FTX. The company maintains the court lacks jurisdiction over Binance’s foreign entities, as they operate outside the United States. Furthermore, Binance counters allegations that CEO Changpeng Zhao’s November 2022 tweet about liquidating Binance's FTT holdings triggered a market panic, stating the tweet responded to publicly available information rather than intending harm.
The lawsuit is part of FTX’s broader effort to recover over $11 billion in lost assets for customers and creditors, with repayments scheduled to begin May 30. Legal proceedings and their outcomes could significantly influence recovery and asset distribution among FTX creditors.