DOJ Probes Binance Over Iran Sanctions Violations

U.S. federal prosecutors are examining whether Binance, the world's largest cryptocurrency exchange, violated American sanctions on Iran by allowing certain transactions to proceed on its platform, Bloomberg reported Tuesday. The inquiry is being led jointly by the Manhattan U.S. Attorney's Office and the Department of Justice's criminal division in Washington, according to people familiar with the matter, with investigators focused on whether Binance knowingly permitted trading activity tied to sanctioned Iranian entities.

The probe is the latest and most direct scrutiny Binance has faced over its handling of Iran-linked funds since a wave of reporting earlier this year. Fortune reported in February that internal compliance investigators had flagged more than $1 billion in Tether flows to Iran-linked wallets before being fired, and the New York Times separately reported that roughly $1.7 billion moved from two accounts, Blessed Trust and Hexa Whale, toward wallets tied to Iranian entities including addresses associated with the Islamic Revolutionary Guard Corps. The Wall Street Journal reported in March that the Justice Department was examining whether Iran had used Binance to evade sanctions and fund Houthi-linked networks in Yemen.

The pattern accelerated this month. On September 14, the DOJ filed a civil forfeiture complaint seeking to recover roughly $61 million in cryptocurrency tied to illicit Iranian oil sales, alleging that Blessed Trust and Hexa Whale used Binance trading accounts to launder proceeds from black-market crude sales and funnel the money to the Iranian government and its proxies. Prosecutors said the two firms, which served Chinese oil and petroleum company clients while posing as a digital asset custodian and a commodities brokerage respectively, were part of a larger network moving more than $1.5 billion in illicit Iranian oil proceeds through interconnected crypto addresses to IRGC-linked businesses and an Iranian exchange. That forfeiture action followed U.S. sanctions imposed on Nobitex, Iran's largest crypto exchange, in June.

Binance said in a statement that it maintains a “zero-tolerance approach to sanctions violations” and fully cooperates with law enforcement, adding that its own internal reviews found no violations and that it does not permit direct transfers to Iran. The company has also pointed to a 96.8% reduction in its sanctions-related exposure between January 2024 and July 2025 as evidence of improved compliance controls.

A Company Still Under a Compliance Microscope

The scrutiny comes three years after Binance pleaded guilty in 2023 to violating U.S. anti-money laundering and sanctions laws, paying a $4.3 billion penalty in one of the largest corporate settlements in American history. Founder Changpeng Zhao stepped down as chief executive and served four months in prison before receiving a presidential pardon, while the settlement installed independent compliance monitors inside the company. Bloomberg's report indicates the current criminal probe is scrutinizing Binance's own conduct and compliance performance in the years since that settlement, rather than solely the actions of third parties that used its platform.

The exchange operates against a backdrop of heightened enforcement attention on crypto's role in sanctions evasion more broadly. Separate from the Binance matter, international law enforcement agencies have jointly exposed North Korea's WaterPlum crypto hacking operation, underscoring how sanctioned regimes continue to probe digital asset rails for ways around traditional financial controls. Geopolitical pressure on crypto payment infrastructure has also shown up elsewhere, with Saudi Arabia's exit from the China-led mBridge blockchain payment system reflecting similar caution around cross-border settlement rails that could draw sanctions scrutiny.

For Binance, the stakes extend beyond potential fines. Any finding that the exchange knowingly facilitated Iran-linked trading after its 2023 settlement, which already carries ongoing monitoring obligations, could trigger a fresh round of penalties or tighter restrictions at a time when the exchange remains the dominant venue for global crypto trading, including a market that has seen Bitcoin repeatedly squeeze short sellers through a series of rapid rallies this year. Prosecutors have not announced charges, and the investigation could still close without any enforcement action against the exchange itself.

FAQ

What exactly is Binance accused of in this investigation?
Federal prosecutors are examining whether Binance violated U.S. sanctions on Iran by failing to stop trading activity on its platform tied to sanctioned Iranian entities, including whether the exchange knowingly allowed those transactions.

Is this the same as the $61 million forfeiture case?
It's related but broader. The $61 million civil forfeiture complaint filed September 14 targets specific funds allegedly laundered through Binance accounts held by Blessed Trust and Hexa Whale, while the criminal probe reported by Bloomberg examines Binance's own compliance conduct more broadly.

Has Binance faced sanctions penalties before?
Yes. Binance pleaded guilty in 2023 to anti-money laundering and sanctions violations and paid a $4.3 billion penalty, with founder Changpeng Zhao serving four months in prison before a presidential pardon.

How has Binance responded to the new investigation?
Binance says it has a zero-tolerance approach to sanctions violations, fully cooperates with law enforcement, and that its internal reviews found no violations, while citing a 96.8% reduction in sanctions-related exposure between January 2024 and July 2025.