Senator Richard Blumenthal is turning up the heat on Binance after internal investigators at the crypto exchange reported what they described as massive digital-asset flows tied to Iranian-linked entities. Those investigators flagged roughly $1.7 billion in transfers connected to two Binance accounts, raised concerns about a Hong Kong fiat vendor, and then watched as several staffers who sounded the alarm were suspended or fired. Binance says it shut down the accounts, cut ties with the vendor, and has found no evidence of sanctions violations, but Blumenthal now wants to know whether compliance personnel were pushed aside in the process.
In a formal letter to the company, Blumenthal requested a trove of internal records, including documents on the $1.7 billion in questioned flows and on “the suspension and dismissal of compliance staff and investigators” who handled the matter. He also asked Binance to preserve relevant communications and lay out a detailed timeline of what executives did and when, according to The New York Times.
Reporting by The Wall Street Journal and other outlets describes internal Binance documents that trace activity through Hong Kong entities, including a vendor called Blessed Trust and a firm known as Hexa Whale. Those files and interviews say investigators linked about $1.7 billion in related flows across 2024 to 2025, and that some employees who pushed for tougher verification checks were later disciplined or removed from the review.
Binance has pushed back on the narrative, saying its own internal review “did not find evidence of sanctions violations,” that it closed the accounts at issue, and that it stopped working with the Hong Kong vendor in January. In a statement reported by The Guardian, the company said certain staff were disciplined for “unauthorized disclosure of confidential client information,” not for raising compliance concerns, and added that its findings have been shared with U.S. authorities.
The controversy is unfolding against a politically charged backdrop. President Trump granted a full pardon to Binance founder Changpeng Zhao on October 23, 2025, and Binance had already pleaded guilty in 2023 to violating U.S. anti–money laundering laws, agreeing to pay roughly $4.3 billion in penalties. Separate reporting by The Wall Street Journal has highlighted links between Binance and the Trump-family crypto venture World Liberty Financial, adding yet another layer of political intrigue to Blumenthal’s inquiry.
Why Regulators Are Watching
Government officials and investigators have long warned that cryptocurrency can be used to dodge sanctions and build shadow financial networks. That concern was underscored by a FinCEN analysis that identified about $9 billion in potential Iranian shadow-banking activity in 2024. According to FinCEN, that broader threat landscape helps explain why senators are pushing for internal Binance records instead of simply trusting an in-house compliance review.
Blumenthal’s office has indicated it will sift through the documents once Binance turns them over, and the company “did not immediately respond” to a request for comment on Tuesday, according to The New York Times. Lawmakers and regulators are now watching how Binance and its peers respond to the inquiries, and what the records reveal, to decide whether additional oversight or enforcement moves are on deck.
