{"id":41193,"date":"2024-11-12T07:20:22","date_gmt":"2024-11-12T07:20:22","guid":{"rendered":"https:\/\/crowdfundjunction.com\/blog\/ftx-sues-binance-former-ceo-cz-for-alleged-fraudulent-1-76b-transfer\/"},"modified":"2024-11-12T07:20:22","modified_gmt":"2024-11-12T07:20:22","slug":"ftx-sues-binance-former-ceo-cz-for-alleged-fraudulent-1-76b-transfer","status":"publish","type":"post","link":"https:\/\/crowdfundjunction.com\/blog\/ftx-sues-binance-former-ceo-cz-for-alleged-fraudulent-1-76b-transfer\/","title":{"rendered":"FTX sues Binance, former CEO CZ for alleged fraudulent $1.76b transfer"},"content":{"rendered":"<p><b>(Originally posted on : CoinJournal: Latest Crypto News, Altcoin News and Cryptocurrency Comparison )<\/b><br \/>\n<\/p>\n<div data-site=\"CoinJournal\">\n<div class=\"post-article-image  -mt-24  mb-8  lg:-mt-32  rounded  overflow-hidden\" data-site=\"CoinJournal\">\n<picture><source srcset=\"https:\/\/coinjournal.net\/wp-content\/uploads\/imagecache\/2023\/07\/1690392498650-96d2a614-3f11-41c9-bfcc-04f2cc0e8674-smartcrop-750x375.webp\" type=\"image\/webp\" media=\"(min-width: 750px)\"\/><source srcset=\"https:\/\/coinjournal.net\/wp-content\/uploads\/imagecache\/2023\/07\/1690392498650-96d2a614-3f11-41c9-bfcc-04f2cc0e8674-smartcrop-363x181.webp\" type=\"image\/webp\"\/><source srcset=\"https:\/\/coinjournal.net\/wp-content\/uploads\/imagecache\/2023\/07\/1690392498650-96d2a614-3f11-41c9-bfcc-04f2cc0e8674-smartcrop-750x375.jpg\" type=\"image\/jpeg\" media=\"(min-width: 750px)\"\/><source srcset=\"https:\/\/coinjournal.net\/wp-content\/uploads\/imagecache\/2023\/07\/1690392498650-96d2a614-3f11-41c9-bfcc-04f2cc0e8674-smartcrop-363x181.jpg\" type=\"image\/jpeg\"\/>\n<\/picture>                    <\/div>\n<ul>\n<li aria-level=\"1\">In 2019, Binance acquired a 20% stake in collapsed FTX in a deal with Sam Bankman-Fried<\/li>\n<li aria-level=\"1\">In 2021, Binance and FTX agreed to a deal that saw FTX buying back the stake, amounting to $1.76bn in FTT, BNB, and BUSD<\/li>\n<li aria-level=\"1\">The transfer was done by Alameda Research, which was insolvent at the time and couldn\u2019t afford the transaction<\/li>\n<\/ul>\n<p>FTX has filed a lawsuit against Binance and its co-founder and former CEO Changpeng \u201cCZ\u201d Zhao to reclaim $1.76 billion over an alleged fraudulent transfer.<\/p>\n<p>A filing from November 10 stated that Sam Bankman-Fried, FTX\u2019s co-founder, fraudulently transferred \u201cat least $1.76 billion\u201d to Binance and Binance executives in July 2021.<\/p>\n<p>In March, Bankman-Fried was <a href=\"https:\/\/coinjournal.net\/news\/bankman-fried-sentenced-to-25-years-in-prison\/\">sentenced to 25 years in prison<\/a> for defrauding customers.<\/p>\n<p>According to the filing, the transfer was part of a repurchase deal between <a href=\"https:\/\/coinjournal.net\/search\/binance\">Binance<\/a> and <a href=\"https:\/\/coinjournal.net\/search\/FTX\">FTX<\/a> and shouldn\u2019t have occurred. The filing claims that in November 2019, Binance acquired a 20% equity stake in FTX with over one million in Binance\u2019s BNB token in a deal with Bankman-Fried.<\/p>\n<p>Around February 2020, Binance acquired a further 18.4% in WRS, an umbrella company of Bankman-Fried based in the US. However, in July 2021, the two parties agreed on a deal that saw FTX buy back Binance and its executives\u2019 entire stakes in FTX and WRS.<\/p>\n<p>This amounted to around $1.76 billion in FTX\u2019s FTT token, BNB, and BUSD (Binance\u2019s stablecoin), which was funded by FTX\u2019s sister company Alameda Research.<\/p>\n<h2>Couldn\u2019t afford the transaction<\/h2>\n<p>Per the filing, the transfer was fraudulent because Alameda was insolvent at the time and couldn\u2019t afford the transaction. According to testimony from Caroline Ellison, former CEO of Alameda Research, Alameda spent around \u201c$1 billion of FTX Trading\u2019s capital received from depositors to fund the repurchase.\u201d<\/p>\n<p>In September, Ellison was <a href=\"https:\/\/coinjournal.net\/news\/caroline-ellison-sentenced-to-24-months-in-prison-over-ftx-fraud\/\">sentenced to 24 months in prison<\/a> for her role in the collapse of FTX.<\/p>\n<p>Following the repurchase, on November 6, 2022, Zhao is said to have \u201csent a series of false, misleading, and fraudulent tweets that were maliciously calculated to destroy his rival FTX, with reckless disregard to the harm that FTX\u2019s customers and creditors would suffer.\u201d<\/p>\n<p>As a result, \u201cZhao\u2019s false tweets triggered a predictable avalanche of withdrawals at FTX \u2013 the proverbial run on the bank that Zhao knew would cause FTX to collapse,\u201d according to the filing.<\/p>\n<div class=\"post-meta\">\n<hr class=\"mb-6\"\/>\n<h6 class=\"text-3xl  mb-4  text-green-300\">Share this article<\/h6>\n<hr class=\"mb-6\"\/>\n<h6 class=\"text-3xl  mb-4  text-green-300\">Categories<\/h6>\n<hr class=\"mb-6\"\/>\n<h6 class=\"text-3xl  mb-4  text-green-300\">Tags<\/h6>\n<\/p><\/div>\n<\/p><\/div>\n<p><a href=\"https:\/\/coinjournal.net\/news\/ftx-sues-binance-former-ceo-cz-for-alleged-fraudulent-1-76b-transfer\/\">Source link <\/a><br \/>\n<br \/><\/p>\n","protected":false},"excerpt":{"rendered":"<p>(Originally posted on : CoinJournal: Latest Crypto News, Altcoin News and Cryptocurrency Comparison ) In 2019, Binance acquired a 20% stake in collapsed FTX in a deal with Sam Bankman-Fried In 2021, Binance and FTX agreed to a deal that saw FTX buying back the stake, amounting to $1.76bn in FTT, BNB, and BUSD The [&hellip;]<\/p>\n","protected":false},"author":3947362367,"featured_media":41194,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"om_disable_all_campaigns":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0},"categories":[35],"tags":[],"_links":{"self":[{"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/posts\/41193"}],"collection":[{"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/users\/3947362367"}],"replies":[{"embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/comments?post=41193"}],"version-history":[{"count":0,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/posts\/41193\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/media\/41194"}],"wp:attachment":[{"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/media?parent=41193"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/categories?post=41193"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/tags?post=41193"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}