Changpeng Zhao (CZ), former CEO of Binance, has formally requested the dismissal of a multibillion-dollar lawsuit filed by FTX’s bankruptcy estate. CZ argues the U.S. court lacks jurisdiction to adjudicate FTX’s claims concerning billions in allegedly improper offshore transactions between the two cryptocurrency exchange giants.
FTX is seeking to claw back approximately $1.76 billion from Binance, asserting that funds transferred before FTX’s collapse constitute recoverable assets under U.S. bankruptcy law.
The core argument presented by CZ hinges on the applicability of U.S. bankruptcy laws. His legal team contends these statutes do not extend to the specific transactions targeted in the suit, which occurred outside the United States. The legal outcome is poised to carry significant weight for Binance and potentially set an important precedent regarding the reach of domestic bankruptcy courts over international crypto dealings.
This lawsuit represents one facet of the complex legal aftermath stemming from FTX’s implosion, underscoring persistent jurisdictional and regulatory ambiguities surrounding the global cryptocurrency industry.
The fate of the motion now rests on whether the court concurs with CZ’s assertion that the disputes involved lie beyond the scope of U.S. jurisdiction.