Binance passed Russian investigators one user's client data, which now underpins a terrorism charge over crypto donations to Ukraine. The group had previously described its own withdrawal from Russia as complete.
Binance is the world's largest crypto exchange by trading volume. Millions of users buy, sell and store digital assets through the platform. As a financial services provider, the company falls under KYC and AML obligations in regulated markets. That also includes cooperation with law enforcement on lawful requests. After Russia moved into Ukraine, Western sanctions followed at first. In September 2023, the exchange finally sold its entire Russia business to the newly founded platform CommEX. In November of the same year, it additionally paid USD 4.3 billion to settle a US criminal case. The charges there covered money laundering and sanctions violations. Founder Changpeng Zhao pleaded guilty and stepped down as CEO.
A Reuters exclusive now paints a different picture, however. It draws on investigation files covering IT specialist Yuri Belenkiy. Those files show that Binance handed Russian prosecutors his transaction history together with passport and address details. Belenkiy has sat in pre-trial detention since September 2025.
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Binance client data underpins the charge against a Ukraine donor
Yuri Belenkiy is 49 years old and works as an IT specialist. He also holds a Russian passport and a Bulgarian residence permit. In October 2025, Russia's Investigative Committee finally brought formal charges. Belenkiy allegedly transferred more than USD 700 in cryptocurrencies between January 2023 and March 2024. According to the indictment, the recipients were the Ukrainian army and the Azov Brigade. Moscow classifies the unit as a terrorist organization. The charge therefore reads as terrorism financing, even though the indictment names a sum of just over USD 700.
The trigger was a donation appeal on Telegram. Kremlin critic Arkady Babchenko, who lives in exile, had published wallet addresses there to fund medical equipment for Ukrainian soldiers. Babchenko confirmed those appeals. He advises Russian senders against them, though, because they face arrest at home. Moreover, he calls the handover of user data by exchanges inappropriate.
Investigators therefore requested Belenkiy's transaction history directly from the exchange. They wrote to case@binanceholdings.ru, an address that Binance lists on its own website for Russian and Belarusian law enforcement. What came back was far more than a payment overview. In fact, the file contained a confirmation of the customer identity, date of birth, address, phone number and passport number. In addition, the exchange enclosed copies of the Russian passport and the Bulgarian residence permit. The draft indictment went to the Prosecutor General's Office. There, investigators cite exactly those transfers as the basis for the accusations. Consequently, the case rests largely on the information from the exchange.
Binance stays in contact with Moscow despite its Russia exit
The sale to CommEX in late September 2023 counted as a clean break. The buyer was a new entity. Furthermore, the contract provided for no revenue share or buyback option. At the same time, Binance granted a transition period of up to one year for migrating users. The company spoke of a full exit from the country. Market observers nevertheless saw the young exchange as the old business under a new name.
Following that exit, no obligation to cooperate with Russian authorities remained. The data went to Moscow anyway, through a channel the group publicly lists. This pattern is not new.
Reuters made an earlier case public back in 2022. In April 2021, Gleb Kostarev met representatives of Rosfinmonitoring, the supervisory body close to the FSB. Kostarev was then the regional head for Eastern Europe and Russia. He agreed to share customer data in order to trace Bitcoin donations to the network of opposition figure Alexei Navalny. Altogether, the case involved more than 670 BTC, worth around USD 28 million at the time. In contrast, Binance told Reuters back then that Russian authorities had never approached the company on the Navalny matter. Navalny died in 2024 in a penal colony in the Arctic.
On the current case, the exchange points to its general cooperation policy.
"Binance does not make or enforce the laws of any jurisdiction, does not decide charges and does not determine how a government uses information in court proceedings. Like other global financial institutions, we cooperate with lawful requests for information from law enforcement authorities worldwide, subject to applicable legal, data protection and regulatory requirements. Those decisions rest solely with the respective authorities." - Binance spokesperson, written statement
Lawyers see a possible GDPR breach in the data handover
Mike Bystrov, founder of Stellar Consulting, a firm specializing in crypto regulation, considers the handover legally vulnerable. If Belenkiy registered as an EU resident with a Bulgarian domicile, the GDPR applies on his reading. Consequently, Binance would even have had a duty to withhold the data. Without a court order, the exchange may not disclose it. Bystrov knows the company from close range, incidentally. In fact, he once represented Binance himself. In 2021, he sat on the legal team that fought off a Russian network block.
Chapter V of the GDPR governs data transfers to third countries and sets narrow limits. Article 48 further requires, as a rule, an international agreement for requests from authorities in third countries. Such an agreement would be a mutual legal assistance treaty, for instance. Accordingly, the provision does not cover direct correspondence by email on that reading. Binance disputes Bystrov's assessment. Still, the company leaves open whether the transfer amounts to a breach.
The decisive point remains unresolved. Whether Binance formally listed him as an EU customer could not be established. The applicability of the regulation thus remains an open legal question. So far, the competent supervisory bodies likewise stay silent. The European Data Protection Board declined to comment and instead pointed to the responsibility of member states. Bulgaria's data protection commission did not answer inquiries, and the foreign ministry in Sofia had nothing to say either.
The Belenkiy case fits a recurring pattern
Belenkiy is not an isolated case. Legal activists who document such proceedings count several dozen convictions in Russia. Specifically, the courts charged all of them with crypto payments to recipients that Moscow classifies as extremist or terrorist. An independently verified figure, however, does not exist.
The documents on the current proceedings come from The First Department. This NGO gives legal support to defendants in political criminal trials. By its own account, it received the files from a relative of Belenkiy, though no one could confirm that independently. NGO head Dmitry Zair-Bek points to expectations inside the EU. Indeed, hardly anyone there reckons with a group keeping an open channel to Russia's prosecutors after an announced market exit.
The timing hits Binance in a delicate phase. The exchange still holds no MiCA licence in the EU. It withdrew the application in Greece. Later it signalled a fresh application through France. At the end of June 2026, the group additionally announced it would halt its services in several EU countries. The cut-off date was 1 July. Before that, the MiCA deadline had expired without authorization. A debate about the handling of client data thus comes at an awkward moment for that application.
