- Federal court dismisses Binance terrorism lawsuit, ruling no direct link between the exchange and terrorist groups.
- CZ Zhao stresses zero motive for exchanges to support terrorists, highlighting commercial logic and compliance efforts.
- Binance reinforces strict compliance, denying $1.7B Iranian transaction claims, and emphasizes monitoring tools and staff.
A sweeping civil lawsuit accusing Binance, Binance.US, and founder Changpeng “CZ” Zhao of aiding terrorist attacks worldwide has been dismissed. The ruling came from U.S. District Judge Jeannette Vargas in Manhattan on March 6, ending a case involving 535 plaintiffs, including victims and their families.
The plaintiffs also stated that the transactions on Binance supported 64 attacks from 2017 to 2024. Judge Vargas, however, found that there was no plausible connection between Binance or Zhao and the FTOs such as Hamas, Hezbollah, Iran’s Revolutionary Guard, and al-Qaeda.
The court noted that Binance accounts merely transacted on the platform, without deliberate cooperation. Judge Vargas called the 891-page complaint “wholly unnecessary,” despite acknowledging its “weighty” allegations. Plaintiffs received leave to amend their complaint. Consequently, the ruling clarifies that exchanges cannot be automatically held liable for illicit activity conducted by their users, separating user actions from platform responsibility.
CZ Responds with Firm Rebuttal
Within hours, Zhao took to X, reinforcing his attorney Teresa Goody Guillén’s statement. He tweeted, “False news is temporary. Truth always comes with time.” He added, “There are absolutely zero (0) motive for any CEX to have anything to do with terrorists. I imagine they don’t actively trade (no fee revenue).”
Zhao also referenced his personal experience living in the UAE, witnessing security threats firsthand, underscoring the implausibility of the claims. Guillén praised the ruling, emphasizing that the court recognized the lack of credibility in the plaintiffs’ case.
Binance’s Official Take
Binance confirmed the decision on X, stating it was “pleased to see that the court in this case correctly dismissed these baseless allegations.” Moreover, the exchange highlighted that it “takes compliance seriously and has no tolerance for bad actors.”
CEO Richard Teng has also emphasized a 96.8% reduction in sanctions-related exposure since January 2024, while employing 1,500 compliance staff globally and using 25 monitoring tools. Binance has formally contested media claims of facilitating $1.7 billion in Iranian transactions, calling them “demonstrably false.”
Legal Context and Industry Implications
This dismissal represents a notable legal victory for Zhao, who was pardoned by President Trump in October 2025. Other lawsuits are ongoing, including Raanan v. Binance, which is proceeding in Manhattan, and the North Dakota action, which claims $1 billion was transferred to FTOs.
Hence, the ruling sets a precedent for crypto platforms, distinguishing between platform liability and user misconduct. CZ’s argument that exchanges gain no revenue from terrorist activity frames compliance in commercial terms. Consequently, the crypto industry can reference this case while navigating U.S. anti-terrorism laws.
