The U.S. Department of Justice has accused two Chinese companies of using the cryptocurrency exchange Binance to launder proceeds from the illicit sale of Iranian oil, according to a civil forfeiture complaint filed Monday in federal court in Manhattan. The complaint alleges that the funds were intended to support Iran’s military, including the Islamic Revolutionary Guards Corps, which the U.S. designates as a terrorist organization.
The Justice Department identified the two entities as Hexa Whale and Blessed Trust, both based in Hong Kong. Prosecutors claim these firms funneled over $1.5 billion in illegal proceeds linked to black market oil sales to Iran, with at least some of the funds moving through Binance, one of the largest global crypto trading platforms. The government plans to seize $61 million currently held in accounts managed by Tether, a separate cryptocurrency firm.
According to the complaint, Blessed Trust presented itself as a provider of wealth management and other financial services, masking its role in facilitating transactions tied to sanctioned Iranian entities. Internal Binance investigations last year reportedly uncovered transactions amounting to $490 million sent by Hexa Whale to Iranian-related crypto wallets and $1.2 billion from an account owned by Blessed Trust. The inquiry also disclosed that accounts controlled by Blessed Trust’s CEO and Binance employees were accessed from the same electronic device, and Binance’s internal records marked these accounts as “Internal accounts,” instructing staff not to block them.
While Binance has denied allegations of wrongdoing and emphasized its intolerance for sanctions violations, the company faced internal controversy over its handling of the matter. Reports emerged that compliance officials who flagged the Iran-related transactions were suspended or dismissed, though Binance asserted that these personnel actions were unrelated to those warnings. The exchange has struggled with regulatory compliance in recent years, agreeing last year to pay $4.3 billion in penalties for violating U.S. financial laws. Since then, Binance CEO Changpeng Zhao stepped down and served a brief prison term.
Binance’s spokeswoman reiterated that the Justice Department’s action does not charge the platform with direct misconduct, stating that Binance did not permit transactions involving sanctioned individuals. The company has vowed to strengthen efforts to prevent illicit activities and collaborate with law enforcement globally.
The revelations have drawn attention from U.S. lawmakers, with a leading Senate Democrat launching an investigation into Binance’s compliance practices. The case highlights ongoing challenges in regulating digital assets and enforcing sanctions through cryptocurrency channels.
Blessed Trust did not respond to requests for comment. Hexa Whale has reportedly ceased operations.