TechFlow News, March 7: According to a Reuters report, U.S. District Judge Jeannette Vargas of the Southern District of New York dismissed a civil lawsuit seeking to hold Binance and its founder Changpeng Zhao liable for allegedly facilitating global terrorist attacks through their trading activities. The judge ruled that the 535 plaintiffs—including victims and their families—failed to plausibly allege that the defendants “intentionally conspired with, participated in carrying out, or ensured the success of terrorist attacks through their conduct.” The plaintiffs alleged that the attacks—occurring between 2017 and 2024—were carried out by external terrorist organizations including Hamas, Hezbollah, the Islamic Revolutionary Guard Corps (IRGC), ISIS, Kata’ib Hezbollah, Palestinian Islamic Jihad, and al-Qaeda, and sought to attribute hundreds of millions of dollars in cryptocurrency transactions—and transactions involving Iranian users—to Binance and Zhao.
The judge noted that while Binance and Zhao may have been generally aware of the exchange’s potential role in terrorist financing, their relationship with terrorist organizations was limited to “the fact that those entities—or their affiliates—held accounts on Binance and engaged in fair-market transactions.” The judge also criticized the plaintiffs’ 891-page, 3,189-paragraph complaint as “entirely unnecessary,” though she granted leave to amend it. A Binance spokesperson stated: “The court correctly dismissed these baseless allegations. Binance strictly adheres to compliance requirements and maintains a zero-tolerance policy toward illicit activity on its platform.”
