Crypto Drama: Binance vs. FTX – Who’s the Real Villain? 🤔💰

by

Well now, gather ’round, folks, for a tale of high finance and even higher folly! Binance, that grand ship of crypto, has decided to toss a motion into the legal waters, seeking to dismiss a lawsuit that weighs in at a staggering $1.76 billion, brought forth by the FTX estate. It seems they’re trying to shift the blame like a hot potato, claiming the whole debacle was not their doing, but rather the result of some internal shenanigans. 🍟

On the 16th of May, in the hallowed halls of the Delaware Bankruptcy Court, Binance’s legal eagles declared the suit “legally deficient.” They insist that FTX’s downfall wasn’t due to market manipulation or any dastardly deeds, but rather a case of internal misconduct. Sounds like a classic case of “not my fault!” if you ask me. 😏

“The plaintiffs are acting as if FTX didn’t collapse because of one of the most colossal corporate frauds in history,” the filing quipped, pointing a finger at Sam “SBF” Bankman-Fried, who’s now got seven counts of fraud and conspiracy to keep him company. Talk about a party! 🎉

Now, the FTX estate claims that Binance pocketed billions during a 2021 buyback, funded by customer assets that were about as secure as a cat in a room full of rocking chairs. But Binance, with a wink and a nod, says, “Not so fast! FTX was still kicking for 16 months after that buyback, and there’s no way we were insolvent at the time.” Oh, the audacity! 😲

Zhao’s tweet and FTT crash

But wait, there’s more! The lawsuit also points a finger at former Binance CEO Changpeng Zhao, claiming he sent the whole thing tumbling down with a single tweet on November 6, 2022, announcing the liquidation of FTT tokens. A tweet, folks! Who knew 280 characters could wield such power? 🐦

In their defense, Binance argued that Zhao’s tweet was merely echoing concerns that were already floating around like a bad smell. “Our decision to liquidate was based on recent revelations,” they said, referring to a CoinDesk article that exposed Alameda Research’s balance sheet. Sounds like a classic case of “I told you so!”

They further defended Zhao’s claim that they aimed to minimize market impact, stating, “The Complaint contains no such facts.” It’s like saying, “I didn’t mean to break it; it was already broken!” 😂

In a twist of legal gymnastics, Binance challenged the court’s jurisdiction, claiming that none of the foreign entities named are incorporated in or maintain their principal place of business in the good ol’ U.S. of A. So, they argue, the court has no business meddling in their affairs. Clever, eh? 🕵️‍♂️

They also took a jab at the plaintiff’s narrative, calling it “a grab bag of state law claims” based on “pure conjecture — much of it sourced from a convicted fraudster’s hindsight speculation.” Ouch! That’s gotta sting! 😬

Binance has asked the court to dismiss all claims with prejudice, which sounds rather serious. Meanwhile, the FTX estate is still pondering their next move, like a cat on a hot tin roof. 🐱‍👤

FTX to disburse $5 billion in second round of creditor repayments

And just when you thought the drama was over, FTX is gearing up to start its second round of repayments to creditors, more than two years after filing for bankruptcy. Talk about a slow dance! 💃

In a notice dated May 15, the FTX Recovery Trust announced that over $5 billion will be distributed starting May 30 through BitGo and Kraken, targeting parties in the second eligible group under the exchange’s reorganization plan. It’s like a second chance at the prom! 🎊

According to the plan, five creditor groups, dubbed “convenience classes,” are expected to receive between 54% and 120% of their claims. In total, FTX may repay up to $16 billion, depending on how many valid claims come in. It’s a veritable buffet of repayments! 🍽️

Read More

2025-05-20 14:38