Bankrupt cryptocurrency exchange FTX claimed that its cross-network transaction protocol LayerZero operated improperly and filed a lawsuit to recover millions of dollars worth of investments.
FTX filed an application with the Delaware District Court on September 8. to LayerZero, co-founder To Ari Litan and another company owned by Litan To Skip & Goose filed a lawsuit. In the lawsuit demanding the return of funds withdrawn shortly before the bankruptcy of the stock exchange, the relevant amount $40 million stated to be on.
The case is a series of agreements and funds transferred included refund. FTX first investment arm Alameda And LayerZero one between share repurchase agreement mentioned. According to this agreement, LayerZero will be launched in February 2022. with 8% interest Alamedgiven to a $45 million debt and with the current valuation that he sold to the company in return. 150 million worth the dollar 5% bought back his shares.
In another deal, LayerZero was acquired by Alameda earlier this year. for 25 million dollars sold 100 million dollar Stargate Finance (STG), for 10 million dollars It was decided to take it back. However, this agreement It had not yet been implemented. FTX said both deals were subject to bankruptcy law. cannot be considered valid He claimed.
Besides these Chapter 11 bankruptcy laws within the scope of the last period before bankruptcy from a company in 90 days In line with the right to request the refund of the payments made, the withdrawals made by the defendants from the stock exchange were also requested back.
These shots $21 million for LayerZero, $13 million for co-founder Litan and Litan’s company $6.5 million for Skip & Goose was determined as .
FTX claims in the lawsuit that LayerZero has a There is a liquidity crisis He said he knew and LayerZero allegedly exploitation went to an urgent sale agreement. FTX is also between Alameda and LayerZero. a close business relationship He also mentioned that it was. Exchange, LayerZero favored hinted that it might.
Reaction from LayerZero CEO
LayerZero CEO counters FTX claims Bryan Pellegrino via various official social media accounts. in the statements found. The CEO stated that they had requested various meetings with the FTX side regarding the share transfer agreement in the past, but only one they couldn’t come to a conclusion told. In this context, Pellegrino bad minded He argued that it appeared to be designed solely to inflate legal fees.
There were no cases of information abuse regarding withdrawal transactions because even in the month when FTX went bankrupt that he has personally invested millions of dollars in related organizations Stating that the withdrawals are financing routine expenses He stated that it was made for.
Pellegrino also stated that the accounting methods used in the case had major problems in terms of calculation and manipulation especially for have been distorted implied:
This accounting is even worse than the accounting of Sam Bankman-Fried (FTX founder) who got them into this situation.
As part of the FTX bankruptcy case, it continues to sue many companies and parties for the return of customer assets. Last July, FTX, 1 billion dollars He filed a lawsuit against former senior officials of the stock exchange regarding a suspicious transaction.