Binance, one of the top cryptocurrency platforms, and its founder, Changpeng Zhao, are facing a serious lawsuit. This case claims that Binance helped move millions of dollars to groups labeled as terrorists by the U.S., including Hamas and Hezbollah, following the attacks in Israel on October 7, 2023. The lawsuit was filed by U.S. victims of those attacks or their families.
This legal action comes shortly after Zhao received a pardon from former President Donald Trump, who had been previously guilty of money laundering charges. Binance has not responded directly to the lawsuit but insists that it follows international sanction laws.
The lawsuit alleges that Binance knowingly enabled over $1 billion in transactions connected to these terrorist organizations. It highlights a $50 million payment made after the attacks and states that there were multiple transactions from U.S. accounts. In November 2023, Binance admitted guilt regarding money laundering and sanctions violations and agreed to pay over $4 billion in penalties, promising to improve its compliance systems.
Despite this, the lawsuit argues that Binance failed to adequately monitor incoming funds. It claims that the platform only screened for suspicious activity during withdrawals, thus allowing criminals to move large sums of money without oversight. The complaint alleges that Binance was intentionally set up to allow illicit activities and states, “There is no indication that Binance has meaningfully altered its core business model.”
The families affected by the attacks are seeking financial damages through a jury trial. Binance responded by saying they have enhanced their compliance measures and that illicit transactions account for a small part of their trading volume. A spokesperson reaffirmed their commitment to working with regulators and maintaining a secure digital asset environment.
This lawsuit occurs in a broader context, reflecting ongoing scrutiny of the cryptocurrency industry. According to a recent survey, nearly 60% of Americans believe that cryptocurrencies pose risks for financial crimes. This sentiment can be linked to the notion that high-profile pardons, like that of Zhao, could send the wrong message about penalties for illegal activities.
As the case unfolds, it will likely spark debate not just about Binance but the entire cryptocurrency landscape. The influence of regulatory measures and public perception will play a crucial role in shaping the path ahead for digital assets.
For further details on cryptocurrency regulations, you can refer to the U.S. Department of the Treasury’s official guidelines.
