Binance accused of helping terrorists in new US lawsuit
Binance, the world’s biggest cryptocurrency exchange, and its founder Changpeng Zhao are facing a new lawsuit in the United States. The company is accused of helping send millions of dollars to groups the US considers terrorist organisations, including Hamas and Hezbollah.
The lawsuit was filed by Americans who were affected by the 7 October 2023 attacks in Israel, either as victims or family members. They claim Binance allowed money to move through its platform that later supported these attacks.
According to the complaint, Binance allegedly helped move more than $1 billion linked to accounts connected to these groups. This includes $50 million sent after the 7 October attacks, as well as at least two transactions that started from inside the US. The case was filed in a federal court in North Dakota.
Binance declined to speak directly on the lawsuit but insisted it follows all international sanctions rules. The company said only a very small amount of its traded funds come from illegal activity and that it continues to work closely with global regulators.
This lawsuit comes only weeks after President Donald Trump pardoned Changpeng Zhao, known as “CZ.” Zhao had earlier pleaded guilty in 2023 to failing to set up a proper anti–money laundering system at Binance. The pardon has faced strong criticism, with some US lawmakers questioning why Zhao received such special treatment.
In 2023, Binance admitted guilt and agreed to pay over $4 billion in penalties to settle charges of money laundering and sanctions violations brought by the US government. At the time, the company promised to improve its monitoring systems.
However, the new lawsuit claims that even after the settlement, Binance continued dangerous practices. According to the complaint, the exchange only checked accounts for suspicious activity when users were withdrawing money, meaning people could deposit large amounts without proper checks.
The lawsuit says this allowed “terrorists and other criminals” to move funds freely on the platform. It also claims Binance set itself up in a way that made it a safe place for illegal activity, and that there is still no clear sign that the company has changed its main business approach.
The families who filed the lawsuit are asking for financial compensation through a jury trial.
Meanwhile, critics of Trump’s pardon say it sends the wrong message. In a letter last month, top Democrats warned it could encourage more financial crimes, suggesting it signals that wealthy cryptocurrency executives can escape punishment if they benefit the president politically or financially.
Binance says it remains committed to improving its systems and protecting the digital financial space.
