Binance Claims No Direct Ties to Hamas in US Lawsuit
A federal judge has declined to dismiss a class action accusing Binance and its former Chief Executive Changpeng Zhao (CZ) of providing material support to the terrorist organization Hamas. The families of victims of an October 2023 attack by Hamas against Israel alleged in the complaint that Binance, CZ, and the governments of Iran and Syria contributed to the attack by facilitating cryptocurrency transactions.
Binance Argues Crypto is Not “Inherently Dangerous”
On Jan. 30, 2024, Binance’s legal team argued before the US District Court for the Southern District of New York that the lawsuit should be dismissed. Lawyers for Binance held that cryptocurrency is “not inherently dangerous” and denied any allegations that it knowingly had facilitated transactions to benefit Hamas.
“There was no special relationship between Hamas and Binance,” a Binance lawyer argued before the court.
The lawsuit has claimed that Binance had facilitated terrorist financing by providing a conduit for the transfers to be discreetly made. But Binance has maintained it doesn’t implicate the company directly in illegal activity by merely enabling cryptocurrency transactions.
Plaintiffs Point to Binance’s Settlement and Zhao’s Guilty Plea
The plaintiffs cited Zhao’s November 2023 guilty plea of failing to implement an effective anti-money laundering program at Binance, after which he spent four months in federal prison.
Also, it agreed to pay $4.3 billion to US authorities over accusations of violating banking laws and sanctions. The plaintiffs declare that the inability of Binance to monitor transactions is the reason it allowed Hamas to fund its attacks in October 2023.
According to Binance, though, these past infractions bear no relation to any lawsuit, and therefore do not demonstrate liability for Hamas’s activities.
Court Ruling Awaits
Meanwhile, Judge John Koeltl has yet to decide whether to dismiss Binance’s action. At this point, no official responses are expected to file either by the state of Syria or Iran as of now.
This lawsuit continues to make a legal impact since the precedent and the outcome, as judged will impact governments regulation on the sale of digital asset trading, obliging compliance within global crypto AMLs- Anti Money Laundry.
