FTX Used $1.2 Billion in Customer Funds to Buy Out Binance, Bankruptcy Estate May Seek Clawbacks

Sam Bankman-Fried used $1.2 billion of FTX customer funds to buy out Binance CEO Changpeng Zhao, according to accounting professor Peter Easton's testimony.

The $1.2 billion was part of a total $2.2 billion that Bankman-Fried paid Zhao for his equity in FTX.

The FTX bankruptcy estate may be able to legally "claw back" the $1.2 billion from Binance under bankruptcy and civil law.

It is uncertain whether the FTX estate would actually be able to recover assets from Binance, since many of Binance's assets are overseas.

Bad behavior now by Binance could have future implications if they need access to U.S. markets and courts.