A California resident has filed a class action lawsuit against top crypto exchange Binance and the company’s CEO Changpeng Zhao for allegedly trying to monopolize the crypto platform market by harming FTX.
Nir Lahav says in his new lawsuit that he lost crypto when FTX collapsed last November.
His lawyers claim that Binance and Zhao were unhappy with former FTX CEO Sam Bankman Fried’s “regulatory efforts” in the US.
The lawyers draw attention to Zhao’s tweet on November 6, when he announced Binance’s plan to liquidate their holdings of FTX’s native token, FTT, due to “recent revelations.”
Lahav’s lawyers claim:
“Zhao’s tweet caused the price of the FTT to drop 14% in a 24-hour period. Zhao tweeted ‘We are not against anyone.’ But in the same post he added: ‘But we won’t support people who lobby against other industry players behind their backs.’ On Tuesday, November 7, 2022, Zhao tweeted: “There is a significant liquidity crisis. Nasty to protect users, we have signed a non-binding contract [letter of intent]with the intention of fully acquiring FTX.com. ”
However, Lahav’s lawyers note that Binance withdrew from the deal the next day after it emerged that they were “armed with confidential information from FTX entities.”
“Zhao publicly spread this information on Twitter and other social media platforms to hurt FTX entities, ultimately leading to a hasty and unprecedented collapse of FTX entities. FTX Entities and its Board of Directors could not avoid this market collapse before FTX Entities’ bankruptcy filing. Zhao showed no qualms about publicly tweeting to hurt FTX entities.”
Lahav claims that Binance practiced unfair competition and violated laws regulated by the U.S. Securities and Exchange Commission (SEC).
Bankman-Fried has been accused of defrauding investors and mishandling billions of dollars of customer funds in connection with the implosion of the FTX last year. If convicted, he faces decades behind bars.
The SEC sued Binance, Zhao and Binance.US in June, alleging the companies violated securities laws.
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