LayerZero Labs has settled a legal dispute with the FTX bankruptcy estate after two years of conflict. Bryan Pellegrino, the co-founder and CEO of LayerZero, shared this news on social media. He explained that the dispute was not about LayerZero versus FTX, but rather LayerZero versus the creditors, of which they are also a part.
The legal issues began in 2023 when the FTX estate sued LayerZero Labs. This lawsuit stemmed from a deal made between LayerZero and Alameda Research, led by Caroline Ellison, just before FTX declared bankruptcy.
In this deal, Alameda agreed to sell back its 5% equity stake in LayerZero, valued at $150 million at the time. In return, LayerZero would forgive a $45 million loan it had given to Alameda. The FTX estate claimed that these transactions were fraudulent because they occurred while Alameda was already insolvent.
Another agreement involved Alameda selling back 100 million Stargate (STG) tokens to LayerZero for $10 million, despite having originally paid $25 million for them. However, this transaction was never completed.
When the FTX estate filed its lawsuit, Pellegrino responded by calling the claims unsubstantiated. He stated that LayerZero had tried to resolve the issue regarding the Alameda shares but received no response.
Recently, Sam Bankman-Fried’s parents are trying to secure a presidential pardon for their son from Donald Trump. Joseph Bankman and Barbara Fried have met with lawyers and Trump administration members to discuss this matter.
