Binance Refutes US Senate Investigation Concerning Iran, Calls Reports Defamatory
In response to a Senate investigation regarding sanctions violations, the cryptocurrency platform asserted that "no Binance account transacted directly with an Iran-based entity."
The digital currency platform Binance has formally addressed an inquiry initiated in February by eleven United States senators, predominantly rejecting allegations that it enabled transactions with Iranian organizations and disputing the characterization of employee dismissals.
Through a letter sent on Friday to United States Senators Richard Blumenthal and Ron Johnson representing the Permanent Subcommittee on Investigations, Binance stated that the February investigation into the platform's operations was founded on media reports that were "demonstrably false, unsupported by credible evidence, and defamatory in several material respects."
The platform referenced articles published by the Wall Street Journal, New York Times and Fortune, which alleged that Binance terminated workers who disclosed that the firm had enabled over $1 billion worth of cryptocurrency transactions with organizations linked to Iran, specifically Hexa Whale and Blessed Trust. Binance stated that the company initiated an internal investigation following law enforcement inquiries, which led to these entities being removed from the platform.
"[T]o our knowledge, no Binance account transacted directly with an Iran-based entity," said that exchange.
Addressing the media reports' assertions regarding the firing of staff members who alerted executives to the investigation, Binance clarified that certain employees voluntarily resigned, whereas another individual was dismissed for unauthorized disclosure of confidential user data:
"Binance takes seriously the privacy of its users and has no tolerance for employees violating that trust by sharing internal information externally. Binance also closely follows its labor and employment policies. This employment action was no different."
The correspondence from the eleven senators addressed to Treasury Secretary Scott Bessent and Attorney General Pamela Bondi requested a reply by March 13 regarding whether government authorities planned to pursue an investigation into Binance. Through Friday, neither Bessent nor Bondi had made any public statements concerning this issue.
During 2023, Binance entered into a settlement agreement with United States authorities, consenting to remit $4.3 billion as resolution for breaches of sanctions regulations and Anti-Money-Laundering laws. The company's then-CEO Changpeng "CZ" Zhao resigned from his position as part of this agreement and entered a guilty plea to a single felony charge, subsequently leading to a four-month incarceration period.
Trump-Binance ties under scrutiny after presidential pardon
Zhao entered his guilty plea and completed his prison sentence under terms stipulating that he would be prohibited from taking on another executive position at Binance. Nonetheless, during October, United States President Donald Trump granted a pardon to CZ, which from a legal standpoint removed barriers to his potential return to the exchange. Zhao has openly dismissed the possibility of returning as chief executive officer.
Prior to Trump's announcement of the pardon, the administration's connections to Binance had already attracted scrutiny from numerous legislators following MGX, a company based in the UAE, utilizing the USD1 stablecoin created by World Liberty Financial to finalize a $2 billion investment in the exchange. Multiple lawmakers have characterized the transaction as corrupt considering that World Liberty Financial receives backing from the president and his sons.