The world’s largest crypto exchange, Binance, is facing a far-reaching lawsuit. Victims of the deadly Hamas attack on October 7, 2023, are raising serious allegations, claiming the platform facilitated the movement of funds for terrorist organizations over several years and thereby helped finance the attack.
The lawsuit accuses Binance of operating with insufficient anti-terror controls for years, enabling millions of dollars in transactions for Hamas and other militant groups. More than 300 victims and family members are invoking the US JASTA law and are seeking damages from Binance, its founder Changpeng Zhao, and additional executives, as reported by Bloomberg.
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Financing Hamas and other organizations
More than 300 victims and family members of those affected by the October 2023 attack filed a lawsuit in a US federal court against Binance, its co-founder Changpeng Zhao (CZ), and another executive. The legal basis is the US Justice Against Sponsors of Terrorism Act (JASTA), which allows victims to hold companies civilly liable for supporting terrorist activities.
According to the plaintiffs, crypto transactions exceeding 1 billion USD were processed through the platform for groups such as Hamas, Hezbollah, the Islamic Jihad Movement in Palestine, and Iran’s Islamic Revolutionary Guard Corps (IRGC) - both before and after the October 2023 attack. In some cases, around 50 million USD in transfers allegedly occurred shortly after the attack alone.
The complaint claims that Binance used a structure of “omnibus wallets” and weak identity verification, which allegedly allowed terrorist organizations to move funds anonymously and without oversight. It is further alleged that Binance deliberately failed to escalate warning signs or report suspicious activity.
No new allegations
The current lawsuit does not come out of nowhere: Binance already concluded a criminal case in the US in 2023 - related to violations of anti-money laundering and sanctions laws. At the time, the exchange paid a 4.3 billion USD fine, and CZ spent four months in prison.
Despite this settlement and the alleged commitment to improve compliance systems, the new plaintiffs argue that little has changed in Binance’s internal structures - and that the platform continues to serve as a “safe haven for illegal activities.”
The new lawsuit could be precedent-setting - not only for Binance but for the entire crypto industry. If the allegations are upheld in court, substantial civil damages could follow. Moreover, the credibility of centralized crypto exchanges would suffer significantly. In turn, the industry could face stricter regulation, tougher compliance requirements, and a decline in institutional investment.
