The FTX bankruptcy estate continues to pursue litigation against cryptocurrency firms amid its bankruptcy proceedings. In a new lawsuit, a group of companies involved in the FTX case filed a complaint against Binance, seeking to recover $1.8 billion. The complaint was filed on November 10.

FTX Alleges Fraudulent Transfer

According to the filing, the plaintiffs argue that Binance, former CEO Changpeng Zhao, popularly known as CZ, and other executives at the exchange received at least $1.76 billion in a fraudulent transfer from FTX. This transfer occurred through Binance's 2021 stock repurchase agreement with Sam Bankman-Fried, co-founder of FTX, who is currently serving a 25-year prison sentence.

The transaction in question saw Bankman-Fried sell approximately 20% of FTX International and 18.4% of West Realm Shires Services, also known as FTX US, to Binance.

Bankman-Fried financed the buyback with FTX's native cryptocurrency, FTT, alongside Binance-operated tokens BNB and BUSD, which held a combined value of $1.76 billion at the time of transfer.

Alleged Insolvency Linked to Deal

The FTX estate alleges in the complaint that both FTX and its sister company Alameda Research “may have been insolvent from inception,” with balance-sheet insolvency established by early 2021. Given the alleged insolvency, the estate claims the stock repurchase constitutes a fraudulent transaction.

Meanwhile, Zhao was released from US custody in late September after serving a four-month sentence. In a recent interview with Bloomberg, he stated that he is receiving offers to sell his controlling stake in Binance.

However, Zhao did not disclose the identities of the interested buyers. Zhao, who founded Binance in 2017, holds a 90% stake in the exchange, as reported by Finance Magnates. His net worth is estimated at $61 billion, making him the richest crypto billionaire.