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The billionaire Binance founder pardoned by Donald Trump has been accused of facilitating millions of dollars’ worth of payments to Hamas in the wake of its attack on Israel on October 7 2023.
In a complaint filed in US federal court on Monday by American citizens whose family were murdered, maimed or taken hostage in the assault, Changpeng Zhao and the cryptocurrency exchange he founded are alleged to have knowingly provided “substantial assistance” to militant groups including Hamas and Hizbollah, helping them conceal the movement of funds.
The payments allegedly laundered through Binance — the largest crypto exchange in the world — continued even after the company paid more than $4.3bn in November 2023 to settle US charges of violating anti-money laundering and sanctions laws, lawyers for the victims claim in the lawsuit.
Zhao, known as CZ, was himself sentenced to four months in prison after pleading guilty to a charge of failure to protect against money laundering. He was pardoned by Trump in October.
The White House justified the move by saying that Zhao had been “prosecuted by the Biden administration in their war on cryptocurrency” and that US law enforcement agencies had pursued Zhao “despite no allegations of fraud or identifiable victims”.
Binance and Zhao are already facing a separate lawsuit in New York for allegations that they “provided a funding mechanism for Hamas” in the years before the October 7 2023 attack, which triggered the war in Gaza. Lawyers for the company and Zhao have in that case told the court there was “nothing special about the relationship between Hamas and Binance” and that allegations of funding terrorism were “plainly insufficient”.
After Israeli law enforcement authorities ordered dozens of cryptocurrency accounts to be closed in the days after the October 7 attack, Binance confirmed it had “blocked” a “small number” of accounts and added that it “follows internationally recognised sanctions rules”.
Monday’s complaint contains allegations that go further than those made by US prosecutors and in other civil lawsuits. Lawyers for the October 7 families claim that Binance facilitated transactions to cryptocurrency wallets linked to Gaza-based organisations that the exchange knew, or should have known, were linked to Hamas and other proscribed terrorist groups.
They allege that more than $50mn in transactions to accounts linked to Hamas, Iran’s Revolutionary Guards, Lebanese militant movement Hizbollah and Palestinian Islamic Jihad, another faction in Gaza, on public blockchains were facilitated by Binance since October 7 2023.
They further allege that wallets run by Binance itself “sent the equivalent of more than $300mn to designated wallets on the blockchain before the . . . attacks and more than $115mn after”.
“Binance ensured that terrorists and other criminals could deposit and shuffle enormous sums on the exchange with impunity,” lawyers for the plaintiffs allege in the suit, adding that some of the accounts in question remain active. “To this day, there is no indication that Binance has meaningfully altered its core business model.”
In the months leading up to Zhao’s pardon, Binance received a $2bn investment from an Emirati fund that was made using a stablecoin issued by a group part owned by the Trump family.
Zhao and Binance did not immediately respond to a request for comment on the new lawsuit.
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