The Department of Justice has opened a criminal inquiry into Binance Holdings Ltd., the platform that processes trillions of dollars in digital-asset trades each year. Prosecutors from the Manhattan U.S. Attorney’s Office, together with the Justice Department’s Criminal Division, are assessing whether the exchange knowingly permitted activity that violated U.S. sanctions against Iran. The line of inquiry focuses on Binance’s internal monitoring systems and its decision-making process regarding suspicious trades, rather than on individual users alone.
What the investigation targets
Investigators are asking whether Binance’s compliance team overlooked or deliberately ignored red-flag transactions tied to Iranian-linked wallets. The probe examines the exchange’s know-your-customer (KYC) procedures, transaction-monitoring algorithms, and any communications that might reveal conscious intent to bypass sanctions. Although an investigation does not constitute formal charges, the DOJ can choose to decline prosecution, a outcome sometimes referred to as a “declination.” The inquiry also coincides with a separate civil forfeiture action that seeks to seize about $61 million in USDT allegedly derived from black-market Iranian oil sales.
Binance’s recent compliance history
Binance’s entanglement with sanctions law predates the current probe. In late 2023 the exchange pleaded guilty to violations of the Bank Secrecy Act and anti-money-laundering statutes, agreeing to pay roughly $4.3 billion and to accept independent compliance monitors. The settlement followed revelations that the platform had allowed customers in prohibited jurisdictions, including Iran, to move funds through its system. Since then, Binance has reported a 96.8% reduction in sanctions exposure between January 2024 and July 2025, citing upgraded transaction-screening tools and stricter internal controls.
Civil forfeiture case and the wider sanctions landscape
On September 14, a New York federal court filed a verified civil forfeiture complaint seeking all USDT held in ten cryptocurrency addresses linked to the alleged oil-selling network. The government values the seized assets at about $61 million and claims they were intended to finance Iranian government and military entities, including the Islamic Revolutionary Guard Corps. Two Hong Kong-registered firms, Blessed Trust and Hexa Whale, are named as the primary operators of the accounts, though the complaint does not accuse Binance itself of wrongdoing. The case highlights how crypto can be employed to move proceeds from sanctioned commodities, a trend that analysts say surged nearly 700% in 2025, reaching $104 billion in value.
In a written statement, a Binance spokesperson reiterated the company’s “zero-tolerance” policy for sanctions violations and affirmed full cooperation with law-enforcement agencies. The exchange also emphasized that its user-agreement explicitly bans residents of Iran from accessing its services, and that it has taken corrective actions such as removing the accounts of Blessed Trust in January 2026 and Hexa Whale in August 2025 after law-enforcement contact. While the firm continues to deny any illicit activity on its platform, it is simultaneously lobbying for the removal of the independent monitors imposed after the 2023 settlement. The outcome of the DOJ investigation will likely shape future regulatory expectations for the broader cryptocurrency industry.
