Binance-affiliated companies have filed a lawsuit against the founders of Hong Kong-based cryptocurrency payments firm RedotPay, alleging the firm wrongfully diverted more than 470,000 users from Binance Card. The plaintiffs – Nest Trading, DistributedTechnologies, and Chaintecs Consulting Singapore – are seeking $472.8 million in damages. The claim was lodged in a Hong Kong court and names RedotPay co-founders Gao Zhangpeng, Chan Wa Choi, and Yao Chao.
The dispute revolves around an arrangement involving Binance Pay and RedotPay's stablecoin payment cards. Binance alleges that RedotPay allowed customers to fund its cards through Binance Pay in a manner that fell outside the agreed commercial scope, effectively redirecting users to a competing product. The damages figure is based on an estimated lifetime customer value of $925 per user, projecting the future revenue Binance says it lost. RedotPay has denied the allegations and stated it will contest the claims vigorously, adding that the litigation will not disrupt its day-to-day operations.
In addition to the Hong Kong proceedings, a related case has been filed in Singapore by Chaintecs, with a hearing scheduled for Friday. The parallel lawsuits could increase legal costs and raise jurisdictional questions. The case may also affect RedotPay's preparations for a potential initial public offering, as customer acquisition practices and risk disclosures come under scrutiny.
The lawsuit highlights the competitive value of payment-card users in the crypto industry. Binance's card and RedotPay's offering both target the same segment, and disputes over customer ownership could prompt exchanges and payment firms to tighten contractual terms. For Binance, the challenge will be proving the alleged breach caused the claimed user losses, while RedotPay will likely challenge the customer count and the $925 valuation. The outcome could set precedents for how user agreements and partnership disputes are resolved in the crypto sector.
