Binance RedotPay Lawsuit Endangers $4B IPO Timeline

• Binance affiliates are suing RedotPay’s three co-founders in Hong Kong for $472.8 million over alleged user diversion.
• The claim rests on 470,000+ users who allegedly funded RedotPay cards through Binance Pay outside the terms of a 2025 deal.
• RedotPay denies the allegations and says its operations continue normally.
• The filing arrives as RedotPay prepares a US IPO valued above $4 billion, putting the listing timeline at risk.

Binance-affiliated companies filed a $472.8 million lawsuit against the co-founders of crypto payment firm RedotPay in a Hong Kong court, Bloomberg reported on August 5. The plaintiffs accuse Gao Zhangpeng, Chan Wa Choi, and Yao Chao of running a scheme that pulled more than 470,000 paying users off the Binance Card and onto RedotPay’s competing product. RedotPay rejects the claims and says its business is running as usual. The heavier problem for the company sits elsewhere. RedotPay has been preparing a US IPO that could value it above $4 billion, and a fraud claim this large lands in exactly the part of the listing process where it can freeze everything.

Binance built its $472.8M figure from a single per-user number

Binance did not pull the damages figure from thin air. Binance’s affiliates assign each diverted user a lifetime value of $925, apply that across the roughly 470,000 accounts they say migrated, and reach $472.8 million. They separately claim the arrangement funneled about $304 million in Binance Pay funds into RedotPay’s card business. Binance’s three plaintiff entities are Nest Trading Ltd., DistributedTechnologies Ltd., and Chaintecs Consulting Singapore Pte. None of the allegations have been tested in court, and RedotPay disputes both the framing and the underlying numbers.

One prohibited use of Binance Pay triggered the whole dispute

The two firms signed a commercial agreement in March 2025. Under it, RedotPay could tap Binance’s user base for a narrow set of activities: crypto-to-fiat conversion, in-app transfers, and purchases of RedotPay-branded goods. Binance would, in return, extend its own payment service through RedotPay’s network. Binance says it found something else. According to the filing, the exchange discovered in March 2026 that RedotPay had been letting Binance Pay balances flow, without segregation, into a use the contract prohibited: topping up RedotPay’s own payment cards. Binance acted before going to court. On April 3, 2026, it cut off all Binance Pay functionality on RedotPay’s platform, citing a “merchant partner review.” The lawsuit followed four months later.

The claim is worth roughly three times RedotPay’s annual revenue

A fraud suit this size does its work long before a judge rules. RedotPay’s full-year 2025 revenue came in around $158 million, according to investor materials cited by Bloomberg. The damages claim runs to roughly three times that. In the language of a US listing, a pending claim that exceeds a company’s annual revenue is a material risk, and material risks have to be spelled out in detail when a company files its Form S-1 with the SEC. That disclosure obligation is where the pressure builds. RedotPay has retained JPMorgan Chase, Goldman Sachs, and Jefferies for a New York listing it wanted to complete as early as this year. Underwriters of that caliber will not push a deal past investors while a half-billion-dollar fraud allegation sits undocumented in the diligence file.

Binance sharpened the point with one specific argument. Its filing contends that the diverted user cohort itself helped inflate RedotPay’s valuation ahead of the offering. That claim reaches straight into the equity story RedotPay would need to sell. A Binance spokesperson declined to discuss the case in detail and said the exchange would turn to courts and other forums when necessary to pursue what it considers right. Whether or not Binance ever collects $472.8 million, the filing has already inserted itself into the one document RedotPay cannot finish without.

Five senior exits and no CFO gave bankers a head start on doubt

RedotPay walked into this with an open flank. Bloomberg reported in March that at least five senior hires had left within twelve months, including two separate compliance chiefs, and that the company was pursuing its listing without a chief financial officer. Staff described a demanding culture built on extended working hours, and Wall Street advisers had flagged sensitivities tied to the company’s mainland China connections. Jonathan Tsang, RedotPay’s head of legal, reportedly stepped down in late July, weeks before the lawsuits surfaced. Each of those items is the kind of thing a bank’s diligence team catalogs quietly. A fraud suit gives every one of them a sharper edge, because litigation risk and governance instability tend to be read together rather than separately by the institutions deciding whether to price a deal.

Singapore’s Friday hearing sets the pace before Hong Kong rules

The Hong Kong petition is not the only front. Chaintecs Consulting Singapore filed a parallel case there, and the first hearing is scheduled for Friday, August 7. That session will not resolve the substance of the dispute, since factual questions about the contract and the user count run through their own longer timeline in Hong Kong. It will offer the earliest read on how aggressively courts intend to move and whether the two jurisdictions pull in the same direction. RedotPay, for its part, has attributed most of its growth to organic sources and word of mouth rather than any coordinated diversion, and points to record on-chain spending volumes as evidence. Its annualized total payment volume crossed $10 billion in December 2025, with full-year volume up 300% year over year. Those numbers are the counterweight RedotPay will carry into court, and into any conversation with underwriters about whether the listing window is still open.