Binance has gone after RedotPay in Hong Kong courts, seeking nearly $473 million in damages. The crypto exchange's affiliated companies accuse the payments firm of steering more than 470,000 Binance Card users to its own platform in violation of their partnership agreement.
Three Binance entities, Nest Trading, DistributedTechnologies and Chaintecs Consulting Singapore, filed the suit after discovering RedotPay allowed customers to fund its stablecoin payment cards directly through Binance Pay. That loophole, they argue, fell outside the terms of their commercial deal and triggered a mass exodus to RedotPay's service. The math behind the claim is straightforward, if aggressive, the plaintiffs calculated each diverted customer represented $925 in lifetime value, multiplied that by 470,000 users, and landed on $472.8 million.
RedotPay hasn't budged. The Hong Kong-based payments company flatly denied the allegations and said it intends to defend itself in court. A statement on its website promised operations would continue normally and that the lawsuit wouldn't interrupt its expansion plans. Meanwhile, a related case is unfolding in Singapore, where Chaintecs is suing RedotPay's co-founders Gao Zhangpeng, Chan Wa Choi and Yao Chao directly. A hearing there is scheduled to wrap up soon.
The dispute arrives at an awkward moment for RedotPay. The startup claims over 8 million users globally and is actively exploring a U.S. IPO. Taking fire from one of crypto's biggest platforms could complicate that push, though the company's public stance suggests it's betting the legal process will clear its name.
This article provides information about an ongoing legal dispute. It is not financial advice and should not be treated as investment guidance.
