{"id":19558,"date":"2024-11-11T13:06:38","date_gmt":"2024-11-11T13:06:38","guid":{"rendered":"https:\/\/mycryptomania.com\/?p=19558"},"modified":"2024-11-11T13:06:38","modified_gmt":"2024-11-11T13:06:38","slug":"ftx-declares-war-on-binance-and-zhao-for-triggering-a-liquidity-crises","status":"publish","type":"post","link":"https:\/\/mycryptomania.com\/?p=19558","title":{"rendered":"FTX Declares War On Binance And Zhao For Triggering A Liquidity Crises"},"content":{"rendered":"

Sending shockwaves across the cryptocurrency industry, FTX, the bankrupt crypto exchange, has filed a lawsuit against its competitor Binance and its former CEO Changpeng Zhao (CZ).\u00a0<\/span><\/p>\n

Filed on 10 November 2024, the lawsuit<\/a> seeks $1.8 billion in damages, accusing Binance of playing a key role in it\u2019s downfall. <\/span><\/p>\n

Ellison stated that $ 1 billion of customer deposits were used to buy back the Binance stake<\/p>\n

$2.3bn FTT, BUSD, BNB was used but fair market value of FTT is 0.
Claim is for $1.76bn pic.twitter.com\/szBb4uQr0r<\/a><\/p>\n

\u2014 Sunil (FTX Creditor Champion) (@sunil_trades) November 11, 2024<\/a><\/p>\n\n

FTX Sues Binance For Triggering A Liquidity Crises <\/strong><\/h2>\n

FTX was once one of the largest cryptocurrency exchanges in the world, but it filed for bankruptcy in November 2022. <\/span>Revelations of financial mismanagement and fraud remains the main reason behind its collapse.\u00a0<\/span><\/p>\n

Importantly, the company\u2019s downfall led to billions of dollars in losses for investors and shaking public confidence in digital assets.<\/span><\/p>\n

The lawsuit accused Binance and its former CEO Changpeng Zhao of engaging in actions that exacerbated FTX\u2019s financial instability.\u00a0<\/span><\/p>\n

Specifically, FTX claims that Binance\u2019s decision to sell off a large portion of its holdings in FTT\u2014the native token of FTX\u2014triggered a liquidity crisis that ultimately led to FTX\u2019s collapse.<\/span><\/p>\n

In early November 2022, Zhao publicly announced on Twitter (now X) that Binance would liquidate its entire position in FTT due to \u201crecent revelations\u201d about FTX\u2019s financial health.\u00a0<\/span><\/p>\n

Liquidating our FTT is just post-exit risk management, learning from LUNA. We gave support before, but we won’t pretend to make love after divorce. We are not against anyone. But we won’t support people who lobby against other industry players behind their backs. Onwards.<\/p>\n

\u2014 CZ BNB (@cz_binance) November 6, 2022<\/a><\/p>\n\n

This announcement caused panic among investors, leading to a massive sell-off of FTT tokens.\u00a0<\/span><\/p>\n

Within days, FTX was unable to meet withdrawal demands from its users, which forced it to halt operations and eventually file for bankruptcy.<\/span><\/p>\n

The lawsuit argues that Zhao\u2019s actions were a calculated effort to destabilize a competitor. <\/span>The exchange claims that Binance\u2019s move was designed to create fear and uncertainty at a time when the company was already vulnerable.<\/span><\/p>\n

Related : Former FTX Exec Nishad Singh Gets No Jail Time, Ordered To Forfeit $11 Billion <\/a><\/strong><\/p>\n

Zhao Denies Any Wrongdoing<\/h2>\n

Zhao has previously denied any wrongdoing related to FTX\u2019s collapse.\u00a0<\/span><\/p>\n

In past interviews, he maintained that Binance acted responsibly by selling its FTT tokens after concerns arose.<\/span><\/p>\n

Notably, Binance had initially considered acquiring FTX during its liquidity crisis. However. It backed out after conducting due diligence and discovering what it described as significant financial irregularities within the company.<\/span><\/p>\n

This lawsuit marks another chapter in the ongoing legal saga surrounding both companies.\u00a0<\/span><\/p>\n

Related : Changpeng Zhao\u2019s Ambitious Return: Former Binance CEO Pledges To Invest In AI, Blockchain Tech, Biotech <\/a><\/strong><\/p>\n

The post FTX Declares War On Binance And Zhao For Triggering A Liquidity Crises<\/a> appeared first on <\/a>.<\/p>","protected":false},"excerpt":{"rendered":"

Sending shockwaves across the cryptocurrency industry, FTX, the bankrupt crypto exchange, has filed a lawsuit against its competitor Binance and its former CEO Changpeng Zhao (CZ).\u00a0 Filed on 10 November 2024, the lawsuit seeks $1.8 billion in damages, accusing Binance of playing a key role in it\u2019s downfall. Ellison stated that $ 1 billion of […]<\/p>\n","protected":false},"author":0,"featured_media":19559,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-19558","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-discovery"],"_links":{"self":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/posts\/19558"}],"collection":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=19558"}],"version-history":[{"count":0,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/posts\/19558\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/media\/19559"}],"wp:attachment":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=19558"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=19558"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=19558"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}