Sequoia Capital, a venture capital firm headquartered in Menlo Park, California is suing the Chinese founder of the cryptocurrency exchange Binance, Changpeng Zhao (better known as CZ). The American VC fund reportedly accuses CZ of allegedly negotiating with another firm while he signed an exclusivity agreement with Sequoia.
Fast Moving TargetAccording to Hong Kong court filings from March 26 and April 24, CZ and Sequoia started talking about terms for a possible investment by the fund in Binance in August 2017. And that the investment would have bought Sequoia almost an 11% stake in the exchange at a valuation of a mere $80 million. Unsurprisingly, as the prices of bitcoin and many other cryptocurrencies continued to rally, the deal seemed unattractive to CZ and the talks collapsed by the middle of December 2017.
In fact, by the start of 2018 Binance claimed to be the largest cryptocurrency trading venue in the world with over 2.9 million users joining the platform since its launch in July of 2017. Based on that incredible growth the exchange was more fairly valued in the hundreds of millions or even billions of dollars. And by December 14, CZ’s people informed Sequoia that Binance’s existing shareholders considered their proposal to undervalue the exchange, as Bloomberg reports.
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https://news.bitcoin.com/binance-exchange-founder-sued-by-vc-fund-sequoia-capital/
