Binance Seeks Dismissal of FTX’s $1.76 Billion Lawsuit Amid Claims of Internal Fraud Responsibility
The post Binance Seeks Dismissal of FTX’s $1.76 Billion Lawsuit Amid Claims of Internal Fraud Responsibility appeared on BitcoinEthereumNews.com.
Binance is vigorously contesting a $1.76 billion lawsuit from FTX, attributing the collapse of the latter to internal fraud rather than outside interference. This legal skirmish illustrates the complexities surrounding accountability and financial management in the crypto sector. As detailed in the lawsuit, the FTX estate maintains that Binance received billions improperly, linking it to a significant corporate fraud case. Binance seeks dismissal of a $1.76 billion lawsuit from FTX, asserting internal fraud caused the collapse, while highlighting contentious legal issues. Legal Maneuvers: Binance’s Defense Against FTX’s Allegations Binance recently filed a motion to dismiss the $1.76 billion lawsuit initiated by the FTX estate, which contends that Binance and its former CEO, Changpeng Zhao, played a role in the downfall of FTX through alleged market manipulation and malicious actions. Binance’s legal team describes the lawsuit as “legally deficient,” emphasizing that FTX’s catastrophic failure stemmed from internal fraud rather than external forces. The notion that “FTX did not collapse as the result of one of the most massive corporate frauds in history” is central to Binance’s argument. The Dynamics of the FTX Collapse: Key Responsibility and Accountability The FTX estate has accused Binance of profiting from a buyback deal in 2021, suggesting that this transaction was improperly funded using customer assets. In response, Binance asserts that the exchange operated as a “going concern” for an additional 16 months after the buyback and was not insolvent at that time. This defense exhibits a critical defense mechanism in the volatile crypto market: distinguishing between corporate governance failures and genuine market threats. Zhao’s Statement and its Implications for the Crypto Market The legal documents outline that Changpeng Zhao’s public announcement on November 6, 2022, regarding the liquidation of FTT tokens, allegedly triggered a crisis of confidence. Binance contends that Zhao’s decisions were informed by…
