Changpeng Zhao, the CEO of Binance, one of the largest cryptocurrency exchanges by trading volume, has filed a lawsuit against a unit of Sequoia Capital for reputational damages, according to a Coindesk report.
This came as a response to a lawsuit filed by the venture capital giant against Zhao last year after a funding deal went awry.
The allegation of contract violation against Zhao by Sequoia was dismissed by the Hong Kong International Arbitration Centre last December.
As per the filing submitted to the High Court in Hong Kong, the crypto billionaire is claiming that the unit of Sequoia significantly damaged his reputation which prevented him to raise money at a proper valuation for his Exchange .
Sequoia is one of the largest and well-reputed venture funds focusing on tech startups. As per Crunchbase, the Silicon Valley-headquartered company operates 22 funds around the globe and has raised $15.3 billion so far. Zhao’s dealings are with SCC Venture VI, a special purpose vehicle of Sequoia Capital China.
Zhao now seeks monetary compensation from Sequoia as the documents mention an “immediate summary of assessment of damages.”
Compensation to be calculated
The appeal further demands for an investigation to determine whether Zhao “has sustained any and what damages” because of the Sequoia's injunction. Zhao is claiming that the VC firm’s action has affected its fundraising in March 2018, and if “any such damage has been sustained,” he is demanding an amount determined by the inquiry.
“The injunction order has caused loss to me for which I am entitled to reasonable compensation by Sequoia. In particular, I have suffered i) a loss of chance to raise capital through successive rounds of financing at increasing high valuations; and ii) damage to my reputation,” Zhao stated in the court filing.
Meanwhile, after a massive attack on the Trading Platform , Binance is facing another setback as recently a number of its clients complained about losing thousands of dollars due to a server lag.
