TL;DR:
- Binance responded to the U.S. Senate stating that no account on its platform conducted direct transactions with Iranian entities.
- Senator Richard Blumenthal’s investigation was based on reports by the NYT, WSJ, and Fortune, which the exchange described as false and defamatory.
- Binance removed partners Hexa Whale and Blessed Trust after detecting indirect exposure to wallets linked to Iran and cooperated with authorities.
Binance formally responded to an investigation by the U.S. Senate Permanent Subcommittee on Investigations, led by Democratic Senator Richard Blumenthal, which had opened an inquiry into alleged violations of sanctions against Iran. In a letter addressed to the legislator, the exchange rejected the accusations and described the journalistic reports that prompted the inquiry as “demonstrably false” and “defamatory in several material respects”.
Blumenthal’s investigation was based on reports by The New York Times, The Wall Street Journal, and Fortune, which alleged that partners of the exchange —identified as Hexa Whale and Blessed Trust, both headquartered in Hong Kong— had acted as intermediaries for money laundering and facilitated operations with Iranian entities, including some linked to Iran’s Islamic Revolutionary Guard Corps, designated as a terrorist organization by the United States.
The WSJ reported that Hexa Whale had moved approximately $500 million in USDT toward the IRGC. The NYT reported that nearly $1.7 billion flowed from two accounts on the exchange to groups linked to Iran.
Binance Dismantles the Entire Alleged Investigation
Faced with those claims, Binance argued that its internal review —initiated last April after establishing contact with law enforcement— found only indirect exposure to wallets with potential links to Iran. According to the letter, no account on the platform transacted directly with Iran-based entities. The exchange stated that it removed Hexa Whale from its platform in August and severed ties with Blessed Trust in January, after completing its internal investigations.
Exposure Dropped 97%
Binance also detailed that it employs more than 25 advanced transaction monitoring, behavioral analysis, and sanctions screening tools, which would have reduced its exposure to wallets linked to illicit activities by 97%, dropping from 0.284% of the exchange’s total volume to 0.009%. Likewise, exposure to the four main Iranian exchanges fell 97.3% over two years, from $4.19 million to just $110,000.
The exchange also refuted reports claiming that internal compliance investigators had been dismissed after disclosing the suspicious flows, stating that most departures were voluntary and that only one employee was let go for violating internal confidentiality policies. This investigation comes years after Binance and its then-CEO Changpeng Zhao pleaded guilty to operating without registration as a money transmitter, resulting in a $4.3 billion fine and the imposition of independent compliance monitoring.
