Based on reports, victims of the October 7 attacks in Israel have filed a federal lawsuit against Binance and its founder, Changpeng “CZ” Zhao, claiming the exchange allowed large crypto flows to militant groups.
The complaint lists 306 American plaintiffs who say they were killed, injured, or taken hostage and are demanding damages.
Dormant Accounts Draw Scrutiny
According to the filing, the plaintiffs allege Binance helped move more than $1 billion for Hamas and other US-designated groups over several years.
They claim that more than $50 million passed through the platform after the October 7, 2023 assault. These figures sit at the center of the case and could shape the request for compensatory and treble damages.
The complaint also highlights unusual account activity that lawyers say should have triggered alarms. One example involves an account tied to a Venezuelan woman linked to a Brazilian livestock business.
Reports say the account received over $177 million in deposits after opening in 2022 and later sent out more than $130 million in withdrawals. Attorneys argue that movements of this size should have been examined more closely.
Large Sums And Strange Flows
Based on reports, the plaintiffs argue that Binance’s controls were weak or ignored, allowing questionable transfers to move across borders.
The lawsuit lists alleged links to Hamas, Hezbollah, Palestinian Islamic Jihad, and Iran’s Revolutionary Guard. Lawyers claim the platform became a tool for shifting money while avoiding standard financial checks.
Binance has said it complies with international sanctions laws and has denied having any special ties to terrorist groups.
Its legal history forms part of the background: in late 2023, the company pleaded guilty in a major federal case and paid a $4.32 billion penalty tied to anti-money-laundering and sanctions violations.
That earlier case, along with Zhao’s four-month prison sentence, is referenced in the new complaint.
Legal Stakes And Future Impact
The new lawsuit seeks damages under a US anti-terrorism law that can triple any award. If the plaintiffs succeed, the financial and reputational impact on Binance could be severe.
The complaint was filed in federal court in North Dakota and is separate from another case in Manhattan that is already moving through the court system.
The filing also recalls that Zhao’s prison sentence was later followed by a pardon from US President Donald Trump, something the plaintiffs point to as part of the exchange’s complicated legal path.
They argue this new lawsuit is necessary to push for accountability after years of what they see as weak controls.
Featured image from alliance / Zumapress.com, chart from TradingView
