Binance founder Changpeng "CZ" Zhao has fired back against a lawsuit by FTX’s bankruptcy estate demanding $1.76 billion, arguing that U.S. courts have no jurisdiction over the case. In a motion filed on Monday in Delaware, CZ asserted that the case is rooted entirely outside the United States and should be dismissed outright.

“The claims are so remote from Delaware—and even from the United States—that the disputed laws don’t apply,” Zhao’s legal team wrote in the filing. As a resident of the United Arab Emirates and a foreign national, CZ argues that he is beyond the reach of American bankruptcy courts.

“Neither the FTX estate nor FTX Digital Markets can claim that Zhao is ‘at home’ in Delaware jurisdiction,” the filing adds.

The FTX-Binance Share Buyback Happened Abroad, Says CZ

The dispute stems from a July 2021 share buyback agreement between Binance and FTX. In November 2024, the FTX estate sued Binance, CZ, and others, claiming they profited from transactions that were never legitimate.

FTX alleges that Binance executives received funds in return for selling roughly 20% of FTX’s global entity and 18.4% of its U.S. arm. The money for the deal came from Alameda Ltd., registered in the British Virgin Islands.

CZ does not deny that the transaction occurred. Instead, he argues that the deal took place entirely outside the U.S.—and that matters. Binance’s legal entities are registered in Ireland, the Cayman Islands, and the BVI, meaning the funds moved through jurisdictions where U.S. laws do not apply. His filing calls the entire case “extraterritorial” and therefore outside Delaware’s legal reach.

“The FTX estate absurdly accuses Zhao and Binance of being responsible for Bankman-Fried’s wrongdoing,” the motion states. CZ adds that he was merely a “nominal counterparty” in the transaction—not its main driving force.

Former Binance Executives Also Seek Dismissal

Two other former Binance executives, Samuel Wenjun Lim and Dinghua Xiao, have also asked the court to dismiss the same lawsuit, calling the case overreaching and misplaced.

CZ’s lawyers further argue that the lawsuit is procedurally flawed because U.S. law does not permit service of legal documents to foreign defendants in bankruptcy cases in this manner. As a result, they claim the case should be halted entirely.

The motion also states that U.S. bankruptcy laws cannot be applied to foreign financial transfers—especially not to securities contracts protected under the “safe harbor” provisions.

“The constructive fraud allegations also fail to meet legal standards under the safe harbor rules,” the filing adds. Under U.S. law, safe harbor protects qualified securities-related transactions from clawback in bankruptcy.

Both sides in this dispute now carry heavy legal baggage. CZ has already served four months in prison for violating U.S. anti-money laundering laws. Meanwhile, Sam Bankman-Fried is serving a 25-year sentence for fraud, conspiracy, and five other charges.

The legal battle between Binance and FTX continues amid a backdrop of criminal convictions, global jurisdictional battles, and the race to recover billions lost in FTX’s collapse.


#Binance , #ChangpengZhao , #CZ , #FTX , #CryptoScandal

Stay one step ahead – follow our profile and stay informed about everything important in the world of cryptocurrencies!

Notice:

,,The information and views presented in this article are intended solely for educational purposes and should not be taken as investment advice in any situation. The content of these pages should not be regarded as financial, investment, or any other form of advice. We caution that investing in cryptocurrencies can be risky and may lead to financial losses.“