Binance to Fight FTX's $1.76 Billion Lawsuit
Date: 2025-05-21 Author: Henry Casey Categories: BUSINESS
The FTX interim administration filed a lawsuit against Binance in November 2024. It alleges that in 2022, shortly before FTX's bankruptcy, Binance and its former CEO Changpeng Zhao received $1.76 billion from FTX-related Alameda Research. According to the plaintiffs, this transaction caused significant damage to FTX's creditors, since the funds were withdrawn in favor of a competing platform, at a time when FTX itself was already in a liquidity crisis.
The lawsuit also contains allegations that the deal was part of a large-scale asset stripping scheme that accelerated the fall of FTX. The administration insists that the transfer of funds took place within the framework of an already financially unsound model and should be considered fraudulent.
Binance categorically disagrees with such accusations. The exchange representatives stated that the lawsuit has no legal force and is aimed solely at distracting attention from FTX’s own management errors. According to Binance’s lawyers, the deal with Alameda Research was completely legal, and the withdrawal of funds is not related to FTX’s internal problems. In addition, they emphasize that the American court has no right to consider Binance’s international operations, and the accusations of fraud are not supported by either documents or facts.
Binance also noted that the collapse of FTX was the result of internal violations and incompetence on the part of its management, in particular, founder Sam Bankman-Fried. The exchange is convinced that it is impossible to shift responsibility to external companies when the causes are within the organization itself.
Meanwhile, as part of the FTX bankruptcy process, the FTX Recovery Trust is already preparing for a second wave of payments to affected clients. On May 30, they plan to distribute more than $5 billion among those whose compensation requests were previously approved. This is part of efforts to restore confidence and partially return funds to creditors.
