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The fallen crypto exchange, FTX has filed a lawsuit against Binance Holdings and its former CEO, Changpeng Zhao (CZ) in fresh legal pursuit. It is seeking to recover nearly $1.8 billion which it claims was fraudulently transferred by Sam Bankman-Fried (SBF). The funds were part of a 2021 stock repurchase deal.
This legal move comes after FTX launched a lawsuit against Anthony Scaramucci and his hedge fund SkyBridge Capital. It was a similar effort to retrieve the money for creditors. The legal challenge is one of 23 filed in the bankruptcy court of Delaware.
<h3 id="span-style-font-weight-400-ftx-accuses-binance-of-fraud-span">FTX accuses Binance of fraud</h3>
According to <a href="https://www.bloomberg.com/news/articles/2024-11-11/ftx-sues-binance-former-ceo-zhao-seeking-1-8-billion-clawback?utm_campaign=socialflow-organic&amp;utm_content=crypto&amp;utm_medium=social&amp;utm_source=twitter" rel="noopener noreferrer nofollow" target="_blank">reports</a>, SBF had repurchased shares of FTX’s international and US units in a 2021 deal. <a href="https://www.cryptopolitan.com/binance-cz-motion-to-dismiss-secs-complaint/" rel="noopener noreferrer nofollow">Binance and CZ</a> received $1.76 billion in FTX tokens (FTT) and Binance’s BNB and BUSD as part of the sale of 20% of FTX’s international unit and 18.4% of the US entity.
FTX alleges that the share repurchase deal was fraudulent as both FTX and <a href="https://www.cryptopolitan.com/ftx-sues-crypto-com-to-recover-funds/" rel="noopener noreferrer nofollow">Alameda Research</a> were insolvent by early 2021. The estate argues that Bankman-Fried’s actions were reckless and manipulative.&nbsp;
It also accused CZ of posting malicious tweets just before the exchange’s collapse. It mentioned a tweet from November 2022 about Binance selling its FTT tokens triggering massive withdrawals from FTX.&nbsp;
FTT token has recorded an uptick recently as its price jumped by 29% in the last 7 days. FTT is trading at an average price of $2.06 with a trading volume of $120 million.
<h3 id="span-style-font-weight-400-ftx-targets-influence-buying-span">FTX targets influence buying</h3>
The lawsuit is one of many filed by FTX against former investors and affiliates. The list includes Anthony Scaramucci and Crypto.com as part of its ongoing bankruptcy proceedings. Binance has yet to respond to the lawsuit.
FTX claims Sam Bankman-Fried engaged in a campaign of “influence-buying” during the 2022 <a href="https://www.cryptopolitan.com/bitcoin-trade-around-57k-since-crypto-winter/" rel="noopener noreferrer nofollow">crypto winter</a>. He allegedly used lavish investments to strengthen his connections in politics and the finance sector.
It alleges that SBF invested $67 million into SkyBridge in 2022 to seek support for the struggling fund. That was the time when the hedge fund was seeking a bailout after its AUM plummeted from $9 billion to $2.2 billion.
Later in September 2022, FTX’s venture arm acquired a 30% stake in SkyBridge. Financial terms were undisclosed, but Scaramucci stated it marked a new era for the firm. FTX now alleges these investments provided little benefit and were designed to prop up SBF’s political and financial status.
The collapsed entity is now targeting these “showy” investments by claiming that they provided no real benefit, and only served to prop up SBF’s standing.

Binance, CZ face FTX’s $1.8B stock repurchase lawsuit

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