Binance and CZ Subpoena Kevin O'Leary in $1.76 Billion FTX Clawback Fight

Binance and its founder Changpeng Zhao have subpoenaed Kevin O'Leary as part of their defense in a lawsuit seeking at least $1.76 billion tied to FTX's collapse, according to filings in Delaware bankruptcy court. The subpoena pulls one of the most prominent FTX-era voices into discovery, more than two years after the exchange failed.

The FTX Recovery Trust and FTX Digital Markets Ltd. filed the case against Binance Holdings Limited and Zhao on November 10, 2024. At its center sits a 2021 transaction in which Binance sold its equity stake in FTX back to the exchange. The share repurchase closed in July 2021, and the estate values it at $1.76 billion.

The trust argues the buyout was a fraudulent transfer. Its core claim: FTX was already insolvent when it paid Binance to exit. Under US bankruptcy law, estates can claw back payments made while a debtor was insolvent, with recovered funds redistributed to creditors. The estate also asserts the $1.76 billion formed part of the funds misappropriated from FTX customer assets, tying the dispute directly to users who lost money when the exchange collapsed in 2022.

Why did Binance and Zhao subpoena O'Leary?

O'Leary is not a random name from the crypto contact list. On December 14, 2022, he testified that Binance intentionally undermined FTX. That accusation now cuts in an unusual direction: the entities he accused are the ones demanding information from him.

The subpoena signals a defense strategy aimed at testing that narrative directly rather than leaving it unchallenged in court records. Whether O'Leary complies or challenges the subpoena's scope will determine how much of his account enters the record.

What did the court decide?

The discovery phase follows a pivotal ruling. On July 27, 2026, US Bankruptcy Judge Karen B. Owens denied motions to dismiss the core fraudulent-transfer claims against Binance and Zhao, opening the door to document demands, depositions and an eventual trial.

Getting to that point took time. Binance contested the court's jurisdiction over the proceedings in early 2025, and its dismissal motions were partially litigated before Judge Owens ruled. The defendants failed to get the central claims thrown out, shifting the case from whether it should exist to what actually happened in July 2021.

What does the case mean for creditors?

For FTX creditors, the arithmetic is concrete. A successful clawback of at least $1.76 billion would add meaningfully to the pool the estate can distribute. Recovery efforts since the 2022 collapse have been a long, grinding legal project, and the Binance suit stands out both for its size and its defendants — the world's best-known exchange and its founder are not typical targets for a bankruptcy trust.

The case also revisits how intertwined the two exchanges once were. Tokens tied to this chapter include FTT, BNB and BUSD, instruments that reflected the relationship before it soured.

The pivotal question remains solvency. The estate must prove FTX was already insolvent in July 2021, and much of the litigation is likely to turn on that single factual point as discovery proceeds toward trial.