FTX, a cryptocurrency derivatives exchange has bagged a $150 million lawsuit from Bitcoin Manipulation Abatement LLC. The lawsuit was based on the premise that FTX violated the rules guiding cryptocurrency, by manipulating markets and peddling unregistered securities in the US. The lawsuit was uploaded onto social media by End of the Chain host, Samuel McCulloch on the 3rd of November. Part of the lawsuit filing accuses FTX of “attacking” Binance exchange. The plaintiff is suing FTX for exemplary and punitive damages.
The plaintiff’s attorneys claim that FTX made use of several accounts to exploit Binance’s Bitcoin futures sometime in September. The lawsuit filing stated that the defendants were caught on the 15th of September 2019 while they were in the act of a deceptive and manipulative scheme. It also stated that the defendant tried, on two illegal occasions, to manipulate the price of Bitcoin futures listed on Binance but was unsuccessful.
The attorneys went on to say that Binance didn’t give in to the attack because its BTC prices are computed through the use of an index. This secured it from light-scale trials to control the direction of the market.
McCulloch summarizes the lawsuit as thus; the plaintiff argues that FTX took advantage of its capacity to falsify BTC prices by using ignition algorithms, to generate excessive liquidation. However, FTX has still not commented on the matter.
Sister Company Facing Lawsuit As Well
In light of the matter, quantitative trading company, BitMEX is still the focus in most news headlines concerning the issue of information leak. BitMEX has come forward to say that they are being used as targets of legal actions. Interestingly, both companies share the same CEO.
The CEO, Almeda, stated that the lawsuit making rounds on the internet against them was filled with ludicrous inaccuracies. He went on to say that they were victims of ill-intended parties who want to defame and extort the company as it is growing in popularity.
Azeez Mustapha is an experienced author, trader, markets analyst, signals strategist, and funds-manager.