Binance Accuses RedotPay of Misleading Users in $470 Million Lawsuit

Affiliates of Binance are pursuing legal action against the founders of RedotPay, a cryptocurrency payments company headquartered in Hong Kong. They allege that the founders have unlawfully redirected hundreds of thousands of customers to a competing service, leading to nearly $500 million in losses.

The entities linked to Binance Holdings, which include Nest Trading, DistributedTechnologies, and Chaintecs Consulting Singapore Pte, have filed a petition in Hong Kong. They claim that RedotPay’s co-founders Gao Zhangpeng, Chan Wa Choi, and Yao Chao violated the terms of a contract established last year, according to court documents obtained by Bloomberg News on Tuesday.

This initial agreement was meant to be mutually beneficial: RedotPay would access the user base of the world’s largest crypto exchange, while Binance would broaden its payment services across a more extensive network. However, Binance alleges that users were allowed to fund a RedotPay stablecoin payment card, which was outside the scope of the agreement.

The lawsuit’s timing is critical for RedotPay, as it has been considering an initial public offering that could be valued at $4 billion, as reported by Bloomberg. The company is also seeking additional funding amidst changes in its senior management team.

Binance now claims that the rerouting of over 470,000 customers from the Binance Card to RedotPay has inflated RedotPay’s market valuation. By estimating the lifetime value of each customer at $925, Binance asserts it has suffered losses totaling $472.8 million.

“Since March 2026, the Binance Group has determined that the RedotPay Group was allowing and promoting the use of Binance Pay funds, without proper segregation, for prohibited purposes within RedotPay, including funding top-ups for the RedotPay Card,” Binance stated in its legal filing.

RedotPay has denied these allegations and has indicated that it will “respond through the appropriate legal channels.”

“RedotPay recognizes the legal action brought forth by Binance and is ready to strongly defend against all accusations,” said a spokesperson for the company. “These proceedings do not impact RedotPay’s daily operations.”

A representative from Binance mentioned that while the company refrains from commenting on ongoing legal issues, “when necessary, we will use courts and other venues to ensure justice is achieved.”

Founded in 2023, RedotPay has swiftly emerged as one of Asia’s prominent crypto payments firms. Its virtual and physical crypto debit cards on the Visa network can be loaded with stablecoins—cryptocurrencies linked to established assets such as the US dollar—allowing users to make purchases at both retail and online merchants.

RedotPay initially entered into an agreement with a Binance affiliate in November 2023, as stated in the filing. However, this agreement was terminated in less than six months due to claims that Binance Pay funds were misused for prepaid RedotPay Cards. A new agreement was established in March 2025 with promises that Binance funds would be kept separate, according to the document.

The contract stipulated that Binance customers could use funds on RedotPay for crypto-to-fiat exchanges, in-app transfers, or to buy RedotPay-branded merchandise.

RedotPay has frequently emphasized its partnership with Binance to attract investors. In 2024 fundraising documents for its Series A, reviewed by Bloomberg, the company cited its association with Binance as a strategy to “accelerate user growth.” It specifically noted that users could deposit directly into the RedotPay Card from Binance Pay.

Binance claims that this collaboration allowed RedotPay to receive around $304 million in user funds from Binance Pay.

Since its inception in 2021, Binance Pay has facilitated more than $280 billion in transactions, according to a report released in January 2026. The Binance Card, a debit card branded by Mastercard, enables users to spend directly from their crypto wallets with participating merchants, according to the company.

RedotPay has attracted investments from a range of venture firms, including Accel, Blockchain Capital, Circle Ventures, Coinbase Ventures, and Galaxy Ventures. It reached a billion-dollar valuation in late 2025 and is aiming for a potential public listing in the US this year.

RedotPay’s annualized total payment volume surpassed $10 billion in December, doubling year-over-year, with revenues also doubling to $158 million, as per separate investor documents reviewed by Bloomberg. The company currently reports an annualized payment volume of $14 billion, $180 million in annualized revenue, and over 8 million users.

Despite rapid growth, RedotPay is confronting significant executive turnover. Bloomberg previously reported that at least five senior hires left within a year. Jonathan Tsang, the company’s head of legal since 2024, announced his resignation effective July 21 via LinkedIn. He did not provide further comments on his departure, and RedotPay did not respond to inquiries regarding it.

Alongside the lawsuit in Hong Kong, Binance’s Chaintecs has also initiated legal actions against RedotPay affiliates in Singapore. A hearing is set for Friday.

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