Democrats Call for Investigation into Binance Over Terrorism Funding Concerns

Democrats in the U.S. Senate are ramping up pressure on Binance, urging the Treasury and Justice departments to look into the exchange’s compliance with sanctions and its safeguards against illicit finance following reports of potential terrorism funding.

A group of nine senators, including key players in negotiations on the Digital Asset Market Clarity Act, sent a letter to federal agencies on Friday, requesting an investigation into Binance in light of news reports suggesting breaches and allegations that the company had fired compliance personnel who uncovered suspicious transactions.

This latest development comes on the heels of Senator Richard Blumenthal’s announcement earlier this week that he was probing Binance and had reached out to the company for information. However, as Democrats are not currently in the majority in the Senate, they do not have direct control over committee investigations.

Binance co-CEO, Richard Teng, has refuted some of the media reports as “inaccurate” and “defamatory.” The company has yet to respond to the senators’ request for comment, which was addressed to Secretary of the Treasury Scott Bessent and Attorney General Pam Bondi.

The senators, including Elizabeth Warren, Ruben Gallego, Angela Alsobrooks, and Mark Warner, expressed serious concerns about Binance’s alleged poor illicit finance controls and their potential threat to national security. They also raised questions about the company’s compliance with a 2023 settlement agreement.

The issue of preventing illicit finance in the crypto industry is a key point of discussion in ongoing legislative debates. Senator Warner has been leading efforts among Democrats to draft legislation addressing this issue.

Another matter highlighted in the senators’ letter is the connection between Binance and World Liberty Financial, the Trump-backed crypto venture behind the USD1 stablecoin. The lawmakers also mentioned former President Donald Trump’s pardon of Binance founder Changpeng “CZ” Zhao, who served time in prison for past issues related to anti-money laundering and know-your-customer rules.