Cryptocurrency exchange Binance is once again facing scrutiny in the United States, this time following a formal inquiry launched by Democratic Senator Richard Blumenthal.
Senate Demands Records From Binance
In a letter dated February 24 and addressed to Binance co-CEO Richard Teng, Blumenthal cited reports suggesting the company enabled “large-scale violations” of US and international sanctions against Iran.
He wrote that the cryptocurrency exchange appears to have disregarded warnings and recommendations designed to prevent Iranian money laundering schemes, allowing approximately $1.7 billion in transfers connected to Iran.
According to the letter, these transactions allegedly supported Iranian-linked terrorist organizations and helped facilitate illicit Russian oil sales conducted through a so-called “shadow fleet” of tankers.
Blumenthal is seeking extensive documentation from Binance as part of a preliminary inquiry by the Senate’s Permanent Subcommittee on Investigations (PSI).
The requests include records related to Binance’s role in potential Iranian money laundering, its handling of sanctioned entities, and its compliance practices. The Subcommittee has asked the company to provide materials by March 6, 2026.
Alleged Findings Of Internal Review
The investigation draws on reporting from The Wall Street Journal, The New York Times, and Fortune. According to those reports, Binance’s internal compliance staff discovered that two partners—Hexa Whale and Blessed Trust—allegedly acted as intermediaries to launder funds and enable trade with Iranian government-linked entities.
Internal reviews reportedly identified roughly 2,000 accounts associated with Iranian entities on the exchange, despite US banking restrictions and Binance’s public claims that it prohibits Iranian users.
Documents obtained by the media outlets further suggest that Binance was warned that Hexa Whale may have been financing terrorist groups such as Yemen’s Houthi movement.
Internal investigators also reportedly identified cryptocurrency transfers to wallets associated with Iran’s Islamic Revolutionary Guards Corps (IRGC) and payments to crew members operating vessels in Russia’s sanctions-evading oil fleet.
Blumenthal’s letter alleges that Binance failed to act decisively despite these warning signs. Investigators within the company reportedly recommended stronger “know your customer” controls and suggested banning sailors tied to Russia’s shadow fleet.
However, according to the senator, those efforts were rejected. Binance allegedly granted VIP status to Hexa Whale even though the firm was suspected of using falsified documentation and its staff were said to have been directly involved in Blessed Trust’s questionable trading activity.
No Evidence Of Violations?
Binance has firmly rejected the allegations even ahead of Blumenthal’s inquiry. In a February 22 statement, the company said it conducted an internal review and found “no evidence of violations of applicable sanctions laws.” It also denied terminating investigators for raising concerns about sanctions-related activity.
The exchange emphasized that it has significantly strengthened its compliance systems since its 2023 settlement. According to Binance, sanctions-related exposure—measured as a share of overall trading volume—declined from 0.284% in January 2024 to 0.009% by July 2025, representing a 96.8% reduction.
The company also reported that transaction volume involving four major Iranian crypto exchanges fell from $4.19 million in January 2024 to $1.1 million by January 2026. Binance added that approximately one-quarter of its global workforce is now dedicated to anti-money laundering and sanctions compliance functions.
At the time of writing, the exchange’s native token, BNB, traded at $616, representing a surge of 5% in the 24-hour time frame amid a slight rebound seen in the broader crypto market on Wednesday.
Featured image from OpenArt, chart from TradingView.com
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