Binance Sues RedotPay Founders, Seeks $470 Million Over Alleged User Diversion
Summary
- Binance affiliates filed a damages lawsuit of about $470 million against RedotPay’s co-founders.
- Binance said RedotPay breached its contract and steered Binance users to its own stablecoin payment card service, causing losses.
- Binance said more than 470,000 users moved to RedotPay cards, resulting in total losses of $472.8 million, while RedotPay said the lawsuit will not affect the company’s operations.
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Binance, the world’s largest digital-asset exchange, has sued the founders of digital-asset payments company RedotPay.
Bloomberg reported on Aug. 5 that Binance affiliates Nest Trading, Distributed Technologies and Chantex Consulting Singapore filed a damages suit in a Hong Kong court against RedotPay co-founders Gao Zhangpeng, Chan Wa Choi and Yao Chao, seeking about $470 million.
Binance alleges RedotPay breached an agreement between the companies signed last year and engaged in fraudulent conduct by steering Binance users to its own stablecoin payment card service.
Under the deal, RedotPay was to leverage Binance’s user base, while Binance would expand its payment service through the RedotPay network. Binance claims RedotPay did not faithfully carry out those terms, allowing users to top up RedotPay cards through Binance Pay instead.
In the complaint, Binance says more than 470,000 users switched from Binance cards to RedotPay cards, causing losses totaling $472.8 million.
RedotPay said in a statement that it would actively respond to all claims through appropriate legal procedures and that the lawsuit would not affect the company’s operations.
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