Binance submitted a formal response to a U.S. Senate inquiry denying that any accounts on its platform transacted directly with Iranian entities.
The exchange called media reports underpinning the probe "demonstrably false" and "defamatory" - a characterization that does little to resolve a dispute now involving the Senate's top investigative panel.
The letter, addressed to Sen. Richard Blumenthal (D-Conn.), Ranking Member of the Senate Permanent Subcommittee on Investigations, drew a careful legal distinction: Binance acknowledged finding "indirect exposure" to potentially Iran-linked wallets but insisted no direct flows to sanctioned entities occurred on its platform.
What Happened
Blumenthal opened the preliminary inquiry on Feb. 24, after reporting by The New York Times, The Wall Street Journal, and Fortune alleged that two Hong Kong-based Binance partners - Hexa Whale and Blessed Trust - funneled roughly $1.7 billion to Iran-linked entities.
The WSJ reported Hexa Whale alone moved approximately $500 million in USDT to wallets associated with Iran's Islamic Revolutionary Guards Corps, a U.S.-designated terrorist organization.
The NYT reported that Binance's own internal investigators had identified roughly 1,500 accounts accessed from Iran.
Binance said it offboarded Hexa Whale in August 2025 and Blessed Trust in January 2026 after receiving law enforcement requests. It described that process as evidence its compliance program worked, not failed.
The exchange also rejected allegations that it dismissed compliance staff who raised concerns - a claim Fortune reported separately, noting several senior compliance officials have exited as it searches for a successor to Chief Compliance Officer Noah Perlman.
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Why It Matters
The probe arrives at a politically complicated moment. Blumenthal's letter explicitly cited Binance's financial ties to World Liberty Financial (WLFI), a cryptocurrency venture associated with the family of President Donald Trump, suggesting influence over enforcement decisions.
The SEC dismissed its lawsuit against Binance in May 2025. Trump pardoned Binance co-founder Changpeng "CZ" Zhao in October 2025, after Zhao served four months in prison following the exchange's 2023 guilty plea to anti-money laundering and sanctions violations - a case that cost the firm $4.3 billion.
Blumenthal is in the Senate minority; without Republican co-signers on the subcommittee, the probe carries limited subpoena power. More than a dozen senators have signed the original inquiry letter.