RedotPay is contesting a $472.8mn lawsuit from Binance affiliates that accuses the Hong Kong-based stablecoin card firm of diverting more than 470,000 customers to its own product, testing the company's investor pitch ahead of a planned US listing.
Stablecoin Card Firm RedotPay Contests $472.8mn Binance Diversion Suit
6 August 2026 - 07:01 UTC
Non-segregated use alleged
The case, reported by Bloomberg on 5 Aug, was filed in the High Court of Hong Kong by Binance Holdings-affiliated entities Nest Trading, DistributedTechnologies and Chaintecs Consulting Singapore Pte. A separate legal action in Singapore was filed by Chaintecs with a court hearing scheduled to take place on 7 Aug.
"Since March 2026, the Binance Group has discovered that RedotPay Group had been allowing and encouraging Binance Pay funds to be used, without segregation, for the prohibited use within RedotPay, including card top-ups for RedotPay Card," Binance said in the filing.
The filing also alleges roughly $304mn in Binance Pay user funds was funnelled into RedotPay's ecosystem outside the terms of the March 2025 agreement, according to Bloomberg.
RedotPay rejects claims
In a statement shared with Sandmark on 6 Aug, RedotPay said it "rejects the unfounded allegations made against it and its co-founders and will respond through the appropriate legal process. As the matter is currently before the court, RedotPay will not be commenting further on the allegations, the ongoing proceedings, or matters that will be addressed through the judicial process."
A RedotPay spokesman said the firm and its three banks had no comment on whether there could be an impact on the planned IPO in the US, which Bloomberg reported on 24 Feb could raise more than $1bn and value the firm at more than $4bn. JPMorgan, Goldman Sachs and Jefferies are the banks reportedly working on the potential listing.
The diversion mechanism
The filing lays out how Binance says the diversion worked. Binance's own setup pairs two products: users load funds into Binance Pay, then spend from those balances via Binance Card. Binance alleges RedotPay diverted that flow, letting Binance Pay balances be loaded onto the RedotPay Card instead. Under the March 2025 agreement, Binance Pay could work inside RedotPay for a narrow set of in-app uses – but RedotPay Card top-ups were not on the list, according to the filing.
Binance says RedotPay crossed that line and puts the count of diverted customers at more than 470,000 and, applying a $925 lifetime value per user, arrives at a $472.8mn damages claim. The filing names RedotPay co-founders Gao Zhangpeng, Chan Wa Choi and Yao Chao as defendants. RedotPay rejects the account.
Binance had already moved on the disputed route once, discontinuing Binance Pay functionality on RedotPay on 3 Apr, four months before the lawsuits.
Not merely a payment button
If the commercial agreement is not restored, RedotPay loses not just a payment button, but access to one of crypto's largest customer and liquidity pools, at a time when the company is positioning for its multibillion-dollar IPO.
RedotPay pushed back following the lawsuit filing, insisting that most of its growth has come from "organic sources like word of mouth," and pointing to more than 33% growth of its user base to more than 8mn customers in the last six months. "This is the kind of sustainable growth that comes from people using our app in everyday life," the firm said.
The company says it is profitable, with annualized revenue of about $180mn on payment volume of roughly $14bn, and reported crossing $1bn in monthly volume in July.
The market for crypto-card spending has grown rapidly but remains difficult to measure: Artemis-tracked volumes reached a run rate of more than $18bn by late 2025, and market data show that Visa remains the dominant card network for stablecoin-linked spending.
