$1B crypto-flows claim reignites global scrutiny as plaintiffs invoke America’s strongest anti-terror law
The world’s largest cryptocurrency exchange is back under intense legal fire — this time in a case that could reshape how global regulators treat crypto platforms linked to cross-border conflict financing. More than 300 victims and relatives of victims of the July 10, 2023 attack filed a sweeping lawsuit in U.S. federal court, accusing Binance and its former CEO Changpeng Zhao of enabling terrorist groups to move over $1 billion in digital assets through its systems. Analysts say the case carries global implications not only for Binance, but for every major exchange operating in an era where geopolitics, crypto markets and national-security law are colliding like never before.
Filed in North Dakota, the complaint alleges that Hamas, Hezbollah, Palestinian Islamic Jihad and Iran’s IRGC used Binance to receive, transfer and conceal funding before and after the 2023 attack, including an estimated $50 million processed in the weeks that followed. Plaintiffs argue that Binance’s weak KYC and AML controls — combined with opaque internal transfers between hot and cold wallets — created a permissive environment that allowed sanctioned groups to operate undetected.
What makes the lawsuit uniquely perilous is that it leans on the U.S. Anti-Terrorism Act, one of the most aggressive civil statutes in the American legal system. If plaintiffs prove Binance provided “material support” to a designated terrorist organization, damages can be awarded at multiples of actual losses — opening the door to potentially devastating financial liability. That threat lands at a pivotal moment for the exchange, which in 2023 pleaded guilty to anti-money-laundering and sanctions violations and paid a $4.3 billion settlement to the U.S. Department of Justice. Former CEO CZ also pleaded guilty before later receiving a presidential pardon from Donald Trump in October 2025, a decision that remains controversial among U.S. lawmakers.
Although Binance has resolved its major regulatory battles with the SEC, DOJ and CFTC, legal experts say this fresh wave of civil litigation may be even harder to contain. Unlike regulatory actions, Anti-Terrorism Act cases are driven by victims, not agencies — meaning they can proceed even in periods when Washington’s official posture toward crypto becomes more lenient. The lawsuit also revives broader concerns that large crypto exchanges have become entangled in global conflict financing, a narrative likely to draw attention from European, Middle Eastern and Asian regulators who have recently tightened controls on cross-border digital-asset flows.
Binance has not issued a formal response, but the case is expected to stretch on for months and may force the exchange to further overhaul compliance systems at a time when the U.S. political environment is demanding that crypto firms be treated with the same accountability standards as major financial institutions.
Whether this lawsuit becomes a turning point for crypto regulation — or another high-profile battle Binance ultimately survives — will shape the global digital-asset landscape. For now, the message from Washington is unmistakable: in the new era of geopolitical risk, crypto is no longer outside the reach of the world’s toughest national-security laws.
