Binance says Iran-linked transaction reports are false and misleading

Binance pushed back hard against a February 24 letter from Senator Richard Blumenthal, saying the claims tied to Iran, money laundering, and platform compliance were “false, misleading, and politically driven.”

In its very long response letter released on Friday, Binance said it respected the work of the Senate Permanent Subcommittee on Investigations, but vows that it takes its legal duties seriously and shares the goal of keeping the platform safe.

It also said it has strict KYC and compliance controls and does not allow users who reside in or are located in Iran to use the platform.

Binance said the Senate letter centered mostly on two entities, Hexa Whale and Blessed Trust, which had alleged indirect exposure to wallet addresses with possible Iran ties.

The exchange said it became aware of those concerns after launching proactive investigations in response to law enforcement requests, then removed both entities from Binance.com. It also said, to its knowledge, no Binance account transacted directly with an Iran-based entity.

Binance expands compliance and answers the Senate letter

In the response, Binance said the press reports behind the inquiry were “demonstrably false, unsupported by credible evidence, and defamatory in several material respects.”

The exchange said it has spent hundreds of millions of dollars in recent years to build out its compliance system. It said that spending was meant to strengthen the company’s controls, protect user funds, support regulatory work, and keep trading safer.

As part of that buildout, Binance said it raised its compliance headcount to more than 1,500 people worldwide. That group, it said, includes hundreds of specialists with training in sanctions, counter-terrorist financing, and financial crimes investigations.

The company also said it uses people, internal processes, and technical systems to detect suspicious activity, report it, and work with law enforcement.

According to the letter, Binance has deployed more than 25 tools for customer due diligence and monitoring. It said those systems cover onboarding checks, transaction monitoring, sanctions screening, and behavioral analytics. It also said those tools help it detect illicit transactions more precisely while cutting false positives.

Binance also pointed to outside partnerships. It said it works with law enforcement agencies and networks, including the Beacon Network and the T3 Financial Crime Unit.

It described those efforts as real-time crime-fighting programs that freeze and recover illicit funds before the money can move further. It said T3 froze more than $300 million in tainted funds during its first year.

The exchange then added scale. It said it now serves more than 300 million users worldwide. In 2025 alone, it said, it processed more than 71,000 law-enforcement requests.

Over the last three years, it said it helped law enforcement agencies seize more than $752 million, including nearly $579 million for government agencies in the United States.

It also cited blockchain analytics data to argue that exposure has fallen sharply. From January 2024 to July 2025, Binance said its exposure to wallets allegedly involved in illicit activity dropped from 0.284% of total exchange volume to 0.009%, a decline of nearly 97%. It gave another number tied to an Iran-linked risk.

Across four major Iranian crypto exchanges, it said exposure fell 97.3% in the last two years, from $4.19 million to $110,000.

Binance investigates Hexa Whale and Blessed Trust

The company then addressed the two entities at the center of the letter. On Hexa Whale, Binance said law enforcement contacted it in April 2025 and requested information about transactions between Binance wallets and several non-Binance wallet addresses.

After getting those requests, Binance said its investigators opened a broad review. It said that the review was not limited to the specific wallets flagged by law enforcement. It also looked for any other Binance users with exposure to the same addresses.

In June 2025, the company said it responded and provided user operation logs, including KYC information and transaction data for accounts linked to the identified wallets, including Hexa Whale.

The exchange said it did not stop there. Even after sending the requested records, it continued the investigation on its own. It said that the process ended with Hexa Whale being offboarded on August 13, 2025. The letter described the entity as now defunct.

On Blessed Trust, Binance said it received a separate group of law enforcement requests in the summer of 2025. Those requests identified transactions between Binance user accounts and non-Binance wallets that law enforcement said had ties to terrorist financing. The company said it responded and provided the requested information.

It then said its investigators conducted a deeper review and a source-of-funds analysis. After that work ended, Binance said it offboarded Blessed Trust in January 2026.

Binance rejects VPN claims and defends staff actions

Binance also challenged one of the most explosive claims in the reporting. The Senate letter, according to Binance, repeated a Wall Street Journal allegation that “Binance compliance found 2,000 accounts associated with Iranian entities” on the exchange despite restrictions on Iranian banking and the company’s public ban on Iranian users.

Binance said that the claim was false and said it had “made no such determination.”

The company said it bars users residing or located in Iran and requires identity verification for all customers. It also said it does not knowingly onboard customers who use incomplete or inaccurate documentation.

The response suggested the claim may have grown out of the company’s continuing efforts to tighten controls around VPN use. It then stated that any attempt to get around platform eligibility rules with a VPN is a violation of Binance’s terms of service.

The letter ended by addressing claims about employees tied to the Hexa Whale and Blessed Trust investigations. Binance said reports about how those workers were treated contained major inaccuracies. It said no employee was terminated for escalating compliance concerns. It also said it does not publicly discuss personnel details because of employee privacy.

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