Changpeng Zhao Seeks FTX’s $1,76 Billion Lawsuit Dismissed

Co-founder and former CEO Binance asked the court to dismiss FTX’s claim for $1,76 billion in a deal between Binance and FTX, which the bankrupt exchange claims was entered into fraudulently.

Changpeng Zhao told a Delaware bankruptcy court that the lawsuit seeks to “pointlessly blame” him for the mistakes of Sam Bankman-Fried, the founder of FTX, who is currently in prison after a high-profile fraud trial.

Zhao, a resident of the United Arab Emirates, argued that the lawsuit’s claims were «so far removed» from the United States that «the laws in question, which have no extraterritorial application, are not even relevant.»

The plaintiffs are improperly seeking to extend the bankruptcy law overseas in connection with the fraudulent transfers, Zhao said in a statement.

In November 2024, FTX’s external manager filed a lawsuit against Zhao, Binance and other company executives, claiming that the bankrupt exchange fraudulently transferred Binance $1,76 billion in cryptocurrency to buy back shares. Among the funds were customer funds.

Lawyers said FTX and Bankman-Fried knew they couldn’t finance the share buyback, so they used customer funds to make the deal.

Zhao said «all material aspects» of the share buyback transaction took place outside the U.S. because of Binance The companies are based in Ireland, the Cayman Islands and the British Virgin Islands, and FTX-related company Alameda Ltd was also based there.

In July, two other former leaders Binance Samuel Wenjun Lim and Dinghua Xiao also asked the court to dismiss FTX’s lawsuit.

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