Two Chinese companies allegedly used cryptocurrency accounts at Binance to launder $61 million derived from black-market sales of Iranian oil and attempted to funnel the funds to the Iranian government, according to a forfeiture complaint filed by the U.S. Department of Justice (DoJ). The complaint seeks to seize the funds, which passed through a network of digital wallets that collectively handled over $1.5 billion in proceeds from illicit Iranian oil sales.
The transactions targeted by the forfeiture complaint took place in May and June of last year and have since been frozen. U.S. prosecutors stated that some of the laundered funds were used to finance terrorism, although the complaint does not specify the nature of the terrorist activities or the groups involved. According to the DoJ, the Binance accounts facilitated cryptocurrency transactions representing the proceeds of black-market sales to buyers in China, with funds eventually funnelled to Iranian government entities, their agents, and proxies.
Binance, the world’s largest cryptocurrency exchange, issued a statement emphasizing that the complaint is directed against funds held in digital wallets, not Binance itself or the two Chinese firms named in the complaint, Hexa Whale Trading and Blessed Trust. The company denied permitting any transactions involving sanctioned individuals and reaffirmed its commitment to cooperating with law enforcement. Binance also highlighted its zero-tolerance policy toward sanctions violations and illicit activity.
In 2023, Binance pleaded guilty to U.S. criminal charges relating to violations of anti-money laundering laws and paid a $4.3 billion fine. Its founder, Changpeng Zhao, admitted to failing to prevent money laundering and received a four-month federal prison sentence. Zhao was later pardoned by former U.S. President Donald Trump in October of the same year, amid Trump’s broader efforts to promote cryptocurrencies and reform regulatory oversight of the industry.
The equity stake in Binance owned by Zhao substantially changed hands last year when an Abu Dhabi-based fund acquired $2 billion worth of shares from him, reportedly paying entirely with USDL, a stablecoin issued by World Liberty Financial—a cryptocurrency company linked to Trump’s family. Notably, Binance.com does not operate within the United States; instead, U.S.-based customers are served by Binance.US, a separate legal entity.
Binance remains under a regulatory monitorship until 2028 as part of the plea agreement reached with the U.S. Treasury Department and the Department of Justice. The latest forfeiture case adds to growing scrutiny over the use of cryptocurrency platforms to circumvent international sanctions and finance illicit activities.