A Binance affiliate has officially filed a $473 million lawsuit against a co-founder of RedotPay in a Hong Kong court. The startup, which claims to be the world’s largest stablecoin payment card issuer, is accused of hijacking around 470,000 Binance users to its own platform.
The legal battle stems from a partnership that collapsed halfway through.
Short-lived Alliance Ends in Dispute
The commercial relationship between the two parties was first established in November 2023. This initial agreement was short-lived and fell apart in less than six months. Binance and RedotPay then attempted to mend their business relationship through a second agreement signed in March 2025.
Under the new agreement, Binance imposed one absolute condition: RedotPay had to segregate its user funds. This rule did not work as expected, leading Binance to completely terminate their commercial cooperation in April 2026.
The core of Binance’s lawsuit focuses on the period starting from March 2026. Binance accuses RedotPay of allowing funds from the Binance Pay service to be used directly to top up RedotPay card balances without fund segregation - a practice strictly prohibited in the contract. As a result of this breach of contract rules, Binance claims that nearly half a million of its users migrated to the RedotPay ecosystem.
What is the Fate of the US IPO Ambitions?
The multi-million dollar lawsuit comes at a crucial time for RedotPay. The card issuer is currently finalizing plans for an initial public offering (IPO) in the United States. Their targets include a $4 billion valuation, aiming to raise more than $1 billion in fresh capital.
The legal challenges they face are not confined to just one country. In addition to the case in Hong Kong, another Binance entity, Chaintecs, has also sued a RedotPay affiliate in Singapore. The first hearing for the Singapore dispute is scheduled to take place this Friday.
Facing a series of litigations from its former partner, RedotPay has stated that it rejects all these baseless allegations and is ready to defend itself vigorously in court.
Legal Bills Behind Growth Figures
For Binance, this maneuver is an effort to close the gap to prevent its user base from being eroded by third-party platforms. Meanwhile, for prospective investors monitoring RedotPay’s IPO schedule, the cases in Hong Kong and Singapore carry a practical warning. Sharp growth metrics in a crypto startup’s user base can sometimes stem from the backyard of its own business partner - complete with the accompanying legal fees.
Reported by CoinDesk.
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Disclaimer: This article is for informational and educational purposes only, not financial advice. Cryptocurrency assets are highly volatile and carry significant risk. Always do your own research (DYOR) and never invest more than you can afford to lose.
