U.S. Senator Richard Blumenthal has launched a formal inquiry into Binance over allegations that the exchange processed between $1.7 billion and $2 billion in transactions tied to sanctioned Iranian entities and Russia’s so-called “shadow fleet” of oil tankers.
The investigation follows reports from major U.S. media outlets alleging potential sanctions violations and weaknesses in Binance’s compliance controls.
Key Allegations Under Review
The probe is examining claims that intermediary entities, including Hexa Whale and Blessed Trust, were used to facilitate trades connected to Iranian government-linked organizations.
Lawmakers are also reviewing alleged transfers linked to Iran’s Islamic Revolutionary Guard Corps (IRGC), as well as transactions reportedly tied to Russian oil sanctions evasion efforts.
In addition, the inquiry seeks information about whether compliance staff who raised concerns internally were terminated in retaliation. Another focal point is Binance’s compliance culture, including allegations that more than 1,500 accounts accessed from Iran remained active despite the company’s 2023 plea agreement and commitments to enhanced anti-money laundering controls.
Political and Strategic Context
The inquiry comes amid heightened political sensitivity around Binance’s U.S. posture. Former CEO Changpeng Zhao, widely known as CZ, was pardoned by President Donald Trump in October 2025, a development that has drawn scrutiny from some lawmakers.
Additionally, Binance reportedly custodies a large majority of the stablecoin reserves for World Liberty Financial, a Trump-linked crypto project, adding further political visibility to the exchange’s operations.
Binance Denies Allegations
Binance has strongly denied the claims, calling the reports “defamatory.” The company maintains that it does not serve Iranian users and asserts that its compliance systems proactively detect and report suspicious activity.
According to Binance, its sanctions-related exposure declined by approximately 97% between early 2024 and mid-2025 as part of broader compliance reforms.
Senator Blumenthal has given Binance CEO Richard Teng until March 6, 2026, to provide internal records and communications related to the allegations. The outcome of the inquiry could have significant implications for Binance’s regulatory standing and its broader relationship with U.S. policymakers.
