Binance, one of the world's largest cryptocurrency exchanges, has recently filed a motion to dismiss a $1.76 billion lawsuit brought against it by the FTX estate. The lawsuit accuses the defunct crypto exchange FTX of trying to shift blame for its own failure onto Binance. Filed on May 16 in the Delaware Bankruptcy Court, Binance's legal team argued that the lawsuit is "legally deficient" and that FTX's collapse was not a result of market manipulation or hostile actions, but rather due to internal misconduct.

The motion to dismiss filed by Binance stated that the plaintiffs are ignoring the fact that FTX collapsed as a result of significant corporate fraud. The filing pointed to Sam "SBF" Bankman-Fried's conviction on seven counts of fraud and conspiracy as evidence of internal misconduct within FTX. The lawsuit alleges that Binance received billions in cryptocurrency during a 2021 buyback deal that was funded improperly with customer assets. Binance vehemently denies these claims, stating that FTX remained operational for 16 months after the share repurchase and that there is no plausible evidence to suggest that FTX was insolvent at the time.

Furthermore, the lawsuit also accuses former Binance CEO Changpeng Zhao of triggering a collapse through a tweet on Nov. 6, 2022, announcing the liquidation of FTT tokens. In response, Binance argued that Zhao's tweet was based on publicly known concerns and that the decision to liquidate FTT holdings was due to recent revelations, such as an article exposing Alameda Research's balance sheet. Binance defended Zhao's comment about minimizing market impact, stating that the complaint lacks evidence to suggest otherwise.

In challenging the court's jurisdiction, Binance argued that none of the foreign entities named in the lawsuit are incorporated or maintain their principal place of business in the United States, therefore falling outside the court's reach. The filing criticized the plaintiff's narrative as a "grab bag of state law claims" based on "pure conjecture," much of which is sourced from a convicted fraudster's hindsight speculation. Binance has requested the court to dismiss all claims with prejudice, while the FTX estate has not yet filed its response.

In other related news, FTX is set to begin its second round of repayments to creditors more than two years after filing for bankruptcy. The FTX Recovery Trust announced that over $5 billion will be distributed starting May 30 through BitGo and Kraken, targeting parties

Source: https://cointelegraph.com/news/binance-seeks-dismissal-ftx-1-76b-lawsuit?utm_source=rss_feed&utm_medium=rss&utm_campaign=rss_partner_inbound