As a seasoned researcher with a keen interest in the ever-evolving world of cryptocurrency, I find myself following this FTX bankruptcy saga with bated breath. The latest development – the lawsuit against Binance for allegedly receiving $1.8 billion in fraudulent transfers from FTX – is indeed intriguing.
In the midst of ongoing bankruptcy cases, the FTX estate is persistently filing legal actions against various cryptocurrency businesses.
A group of firms involved in the FTX bankruptcy proceedings has initiated a lawsuit against cryptocurrency exchange Binance, seeking to recover $1.8 billion, according to a complaint filed on Nov. 10.
According to the court documents, the accusers contend that Binance, along with its ex-CEO Changpeng “CZ” Zhao and other high-ranking Binance officials, received approximately $1.76 billion in cryptocurrency through a potentially deceitful transfer from FTX.
The July 2021 deal between Binance involved the resale of approximately 20% ownership in FTX’s international operations and 18.4% in its U.S.-based subsidiary, FTX US (operated by West Realm Shires Services), by Sam Bankman-Fried, who is currently serving a 25-year sentence as the co-founder of FTX.
Based on the report, Bankman-Fried financed the stock buyback using a combination of FTX’s FTX Token (FTT), Binance-operated BNB (BNB), and Binance USD (BUSD) worth approximately $1.76 billion at that moment.
According to their court filing, it’s possible that FTX and its related trading platform Alameda Research were financially unstable from the start, and by early 2021, they were clearly unable to meet their financial obligations (balance-sheet insolvent). The estate claims this situation made a deal where shares were repurchased fraudulent. In simpler terms, the companies might have started with too many debts, and by early 2021, they couldn’t pay their bills, making a share buyback deal questionable.
This is a developing story, and further information will be added as it becomes available.
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2024-11-11 12:15