US Court Dismisses Lawsuit Against Binance and CZ for Terrorism Financing

A federal judge in Manhattan has dismissed a civil lawsuit against cryptocurrency exchange Binance and its CEO, Changpeng Zhao (CZ), which was brought by 535 plaintiffs. These plaintiffs, who are victims or relatives of victims of terrorist attacks, alleged that Binance facilitated 64 terrorist attacks globally.

In her 62-page ruling, Judge Jeanette Vargas stated that the plaintiffs did not provide sufficient evidence to prove that Binance or Zhao knowingly supported or participated in terrorist activities. Consequently, all claims were dismissed.

Binance expressed satisfaction with the court's decision, stating, "We are pleased to see that the court in this case correctly dismissed these allegations without merit. Binance takes compliance seriously and has no tolerance for bad actors on its platform." This sentiment was echoed in a letter to Senator Blumenthal.

Details of the Allegations

The lawsuit claimed that the terrorist acts, attributed to groups like Hamas, Hezbollah, and ISIS, occurred between 2017 and 2024, with substantial cryptocurrency transactions linked to these organizations on Binance. The plaintiffs alleged that hundreds of millions of dollars flowed through the exchange to fund these groups, alongside billions in transactions involving Iranian users supporting proxy attacks.

While acknowledging that Binance and Zhao may have had a general awareness of potential connections to terrorism financing, the judge noted that their involvement was limited to allowing accounts and transactions related to these groups without direct participation.

Responses from Involved Parties

Zhao criticized the plaintiffs, suggesting they were attempting to exploit Binance's ongoing legal issues, including a recent $4.32 billion fine for anti-money laundering violations, to seek triple damages under federal anti-terrorism laws. Meanwhile, Binance reiterated its dedication to compliance, while representatives for the plaintiffs did not respond to requests for comments.

This ruling follows Binance's previous denial of accusations regarding sanctions violations and alleged transfers of $1.7 billion to Iranian-linked accounts.