As you may remember, in June, the SEC filed a lawsuit against Binance, the world's largest cryptocurrency exchange, its US branch Binance US and its CEO CZ.
While this case was ongoing, another lawsuit was filed against CZ and Binance. A class action lawsuit was filed against Binance US and CZ in the California District Court yesterday.
BAM Trading and BAM Management, the companies behind Binance US, were also included as defendants in this case.
According to the documents submitted to the court, the investor group that filed the lawsuit claimed that the collapse of FTX, which went bankrupt in November 2022, was triggered by CZ's social media posts.
The plaintiffs also accuse Binance and CZ of deliberately trying to monopolize the cryptocurrency market by harming its rival FTX, arguing that they are also acting against unfair competition rules at this point.
Because CZ said in his post on his Twitter account before FTX filed for bankruptcy that Binance was in talks to purchase FTX. However, shortly after, CZ stated that he gave up purchasing FTX.
At this point, the plaintiffs stated in their petition: “CZ knowingly shared the offer to buy FTX and the information about their subsequent abandonment on his Twitter account in order to harm FTX. Ultimately, he achieved his goal and resulted in the sudden bankruptcy of FTX and the unprecedented collapse of its token, FTT.” “It caused it to collapse,” they said.
The plaintiffs also pointed out CZ's post about FTX's token FTT, saying “we have decided to liquidate all FTTs in our portfolio” and argued that CZ made this post knowingly and caused manipulation in the market.
*This is not investment advice.