He Held Onto The Seed Phrase And Now BNB Chain Is Taking Him To Court 🌱

BNB Chain has filed a lawsuit against a former employee it says kept the seed phrase to a wallet originally created for a company training video and used it to launch a meme token without authorization. In an August 1 statement on X, BNB Chain said the individual "retained unauthorised access to the associated seed phrase" after leaving the company and generated a new private key from it.

The original address had been created by the worker as part of a tutorial demonstrating how to set up a wallet and issue a token on BNB Chain, and was never intended to be active. The wallet resurfaced months later linked to a new meme coin, prompting BNB Chain to publicly disavow the asset.

"We are now aware that the same address is being used independently in connection with a new meme token. BNB Chain did not create, authorize, promote or participate in the creation of this token and has no control over the token or wallet address," the team wrote.

Binance founder Changpeng Zhao also weighed in on X, calling the person "basically a scammer."

BNB Chain has not named the former employee, identified the meme token, or disclosed where the lawsuit was filed, saying only that lawyers and police are involved. The case is unusual in that it centers on custody of a seed phrase rather than a hack or direct fraud, raising questions about how courts will categorize the conduct and what it means for how crypto firms track credentials after staff departures.

$BNB traded at $579.62 at the time of writing, down 2% over 24 hours, giving the token a market capitalization near $77.2 billion.