Changpeng Zhao, the co-founder and former CEO of Binance, has asked a U.S. bankruptcy court to dismiss a lawsuit filed by the FTX bankruptcy estate. The lawsuit seeks to recover $1.76 billion that allegedly moved between the two entities.
In a recent filing, Zhao argued that he is beyond the court’s legal jurisdiction because he resides in the United Arab Emirates. He also contended that the U.S. statutes cited in the case do not apply to the cross-border transactions in question. “Plaintiffs’ fraudulent transfer claims improperly demand the extension of bankruptcy law abroad,” the filing stated.
The lawsuit, which was filed in November 2024, targets Binance and several executives over a July 2021 equity buyback arrangement. According to FTX’s lawyers, Binance and its former leadership improperly received funds when they sold their ownership stakes in FTX’s global operations and its American subsidiary.
Zhao’s filing claims that Binance and FTX were “briefly business partners” before they separated. He stated that Binance returned its equity stake in exchange for cryptocurrencies. Zhao’s legal team is arguing that he is not responsible for the failures of FTX founder Sam Bankman-Fried and that the court cannot enforce its statutes on the transactions described in the complaint.
Zhao’s filing follows similar dismissal requests from other former Binance executives. Bankman-Fried is currently serving a 25-year prison sentence for fraud and conspiracy charges, while Zhao recently completed a four-month sentence after pleading guilty to U.S. anti-money laundering violations.
