News View Non-AMP

New Lawsuit Accuses Binance Exchange of Manipulating FTX’s Demise

Published by
Nidhi Kolhapur

Cryptocurrency exchange Binance is facing fresh legal trouble after being hit with a class action lawsuit alleging the firm deliberately sparked the implosion of now-bankrupt rival FTX.

Filed in California, the lawsuit spearheaded by plaintiff Nir Lahav claims Binance violated securities law and engaged in unfair competition to undermine FTX’s business.

Specifically, it points to Binance CEO Changpeng Zhao’s November 2022 tweet announcing the firm’s intent to sell its FTX Token (FTT) holdings as a premeditated move to sow distrust and trigger mass FTT sell-offs.

Allegations claim CZ knowingly triggered rival exchange’s collapse

According to the suit, Binance had already offloaded 23 million FTT worth $530 million the previous day, indicating Zhao knowingly sought to manipulate the market and profit from FTX’s demise.

The ensuing FTT crash and loss of user confidence ultimately caused the catastrophic bank run that led to FTX’s abrupt unraveling. Binance then offered to acquire its crippled rival before promptly withdrawing the proposal.

While Binance maintains it acted responsibly in withdrawing from FTX, the lawsuit alleges its public statements and actions were intentionally designed to destabilize and acquire FTX at a cut-rate price.

Binance has yet to comment on the specifics of the litigation. The class action underscores lingering suspicions around behind-the-scenes motivations in FTX’s spectacular collapse. However, proving market manipulation in crypto remains an uphill legal battle.

The coming proceedings promise to further unravel the FTX debacle while testing novel legal boundaries. Regardless of the outcome, the scandal will likely spur tighter industry self-regulation to prevent similar episodes of crypto contagion.

Nidhi Kolhapur

Nidhi is a Certified Digital Marketing Executive and Passionate crypto Journalist covering the world of alternative currencies. She shares the latest and trending news on Cryptocurrency and Blockchain.

Recent Posts

Ethereum Price Struggles Amid Macroeconomic Uncertainty: Will ETH Rebound?

Amid the notable macroeconomic uncertainty caused by the tariff trade wars, Ethereum (ETH) price has…

April 2, 2025

$1.67B Stolen in Q1 2025 – Top Crypto Hacks Revealed!

The first quarter of 2025 was a rollercoaster for the crypto world. Governments pushed for…

April 2, 2025

Ethereum Price Prediction for Q2 2025—Will ETH Price See a Strong Recovery Past $2500?

After experiencing 4 red months in a row, the minor rise in the Ethereum (ETH)…

April 2, 2025

Bitcoin Funding Rates Turn Negative: What It Means for BTC’s Future

In the last 30 days, the Bitcoin market has dropped by around 9.7%. Currently, the…

April 2, 2025

Giorgi Shonia on Critical Steps if Crypto is to Succeed Long-Term

It’s 2025 and we’re pretty honest when we say that crypto has never been bigger.…

April 2, 2025

LiteFinance Launches Largest Crypto Trading Challenge with $1,000,000 Prize Pool

The contest is devoted to the company's 20th anniversary.LiteFinance is running a large-scale contest in…

April 2, 2025