Binance Founder Zhao Reacts to 3AC’s Expanded FTX Bankruptcy Claim of $1.5B!

The U.S. Bankruptcy Court has granted Three Arrows Capital (3AC) permission to raise its FTX bankruptcy claim from $120 million to $1.5 billion after fresh evidence that FTX sold off a large chunk of 3AC’s assets. This has ignited new controversy in the crypto legal battle between FTX, 3AC, and other big players in the industry. Binance founder Changpeng Zhao (CZ) strongly responded to the news, questioning FTX’s history and whether it had played a role in the 2022 LUNA/UST collapse.

3AC’s Expanded Claim: The Core Dispute

Three Arrows Capital contends that FTX unfairly liquidated $1.33 billion worth of its assets just weeks before its downfall. The cryptocurrency liquidation dispute alleges that FTX rushed the sales at significantly reduced valuations, disadvantaging 3AC creditors.

FTX disputes these allegations, claiming that an individual from 3AC had authorized the liquidation. However, the court ruled that 3AC was not at fault for the delay in increasing its FTX bankruptcy claim, as FTX had failed to provide key financial records promptly.​

Changpeng Zhao’s Reaction and the Terra-Luna Connection

CZ took to X (formerly Twitter) to express skepticism over the connections between FTX and 3AC. He suggested FTX’s actions may reach beyond its demise, even affecting the LUNA/UST depeg in May 2022. His tweet, asking if FTX had a secret hand in the collapse, soon went viral with crypto fanatics, sparking widespread rumors and increasing scrutiny of FTX’s previous trades.

Interesting turn of events. I didn't know this before, but not surprised either as they (FTX/3AC) were "close".

I am curious if FTX had anything to do with the LUNA/UST crash/depeg in May 2022? https://t.co/oubjKHvfMC

— CZ 🔶 BNB (@cz_binance) March 14, 2025

This remark fed rumors of FTX’s involvement in larger market disruption. Adding to the controversy, MBottjer, co-founder of the FTX creditors’ committee, disclosed that 3AC only recently discovered that FTX had liquidated far more assets than initially reported. He stated that FTX withheld critical data, preventing 3AC from making a full claim before the deadline​.

FTX’s Counterarguments and Legal Challenges

FTX bankruptcy estate has objected to 3AC’s larger claim, contending that it would make things complex in its reorganization process and push back payments to other creditors. The court, however, overruled these fears by saying that 3AC’s original claim opened the door for subsequent claims to be brought later.

In addition to its ongoing battle with 3AC, FTX is also in the midst of an ongoing crypto legal battle with Binance, claiming that its previous CEO, CZ, enabled a fraudulent $1.75 billion transaction. Meanwhile, creditors continue to analyze how FTX’s leadership managed funds before its collapse​.

Future Implications: What Comes Next?

There is a full hearing scheduled for November 20, and the outcome may have significant implications for how crypto bankruptcies and asset liquidations are treated going forward. If 3AC’s widened FTX bankruptcy claim is successful, it could lead to tighter regulations over exchange transparency and liquidation procedures.

Meanwhile, FTX continues distributing recovered funds to creditors, but concerns persist over its past financial mismanagement case. Industry experts believe that this case could reshape how courts approach disputes in the crypto sector, potentially setting new legal precedents​.

Final Thoughts

With new allegations coming to light and court battles intensifying, the ripple effects of the FTX and 3AC meltdowns continue to reverberate throughout the industry. Whether or not FTX was involved in the LUNA/UST meltdown is still unclear, but as fresh evidence comes to light, the case turns out to be one of the most defining in crypto history.