Recent concerns over the future of Binance’s cooperation with US authorities in cryptocurrency investigations have brought renewed focus to the ongoing differences between the company and the Department of Justice (DOJ). In May, Binance accounted for approximately 39% of the global spot crypto trading volume and has long played a key role in tracking and freezing digital assets tied to theft or sanctions.
DOJ internal memo raises concerns
According to The Information, an internal DOJ memo warned prosecutors handling crypto cases that support from Binance might soon fall short of expectations. The memo indicated Binance could implement new conditions before complying with requests to freeze or seize customer assets.
The note was reportedly drafted by Rachel Jones, the DOJ’s digital currency adviser, and shared with investigators handling crypto cases. Among those briefed was Kevin Mosley, who worked on Binance investigations in 2023.
Binance insists that there have been no changes in its cooperation with US law enforcement and that none are planned.
Abu Dhabi license at the center of the dispute
Binance management attributes the disagreement to its licensing structure under the Abu Dhabi Global Market (ADGM) framework, an international financial center and free zone in Abu Dhabi. The company claims US authorities have misunderstood data privacy obligations set out under this licensing regime.
According to guidance from the ADGM Data Protection Office, exceptions allowing disclosure generally do not extend to law enforcement requests from outside the UAE. If interpreted strictly, this would mean authorities abroad must make formal mutual legal assistance requests rather than receiving immediate support.
Mini glossary: MLAT refers to mechanisms for mutual legal assistance between countries in criminal investigations, while ADGM applies its own legal and supervisory framework to financial institutions in Abu Dhabi.
On the other hand, the same ADGM guidance permits data transfers necessary to establish, exercise, or defend legal claims, and it specifically cites US regulatory requests as examples. This supports Binance’s argument that cooperation with US authorities can continue under current rules.
The company’s corporate communications unit emphasizes there are no plans to change the way it communicates with US law enforcement and that cooperation with the DOJ is not decreasing but rather expanding.
Oversight environment shifts after 2023 settlement
The issue has become more sensitive following a relaxation of oversight mechanisms established as part of Binance’s wide-ranging 2023 settlement. In November 2023, Binance admitted multiple federal violations—including breaches of the Bank Secrecy Act, unlicensed money transmission, and sanctions violations—agreeing to pay over $4.3 billion in fines and to submit to independent compliance monitoring for three years.
The settlement also required Binance’s full cooperation with US and international law enforcement. However, a note from Deputy Attorney General Todd Blanche in April 2025 announced an end to enforcement-by-litigation for digital assets and the closure of the National Cryptocurrency Enforcement Team, narrowing the scope of direct oversight.
Potential impacts on investigations
If the approach outlined in the internal memo is implemented, Binance could stop granting emergency asset freezes as a courtesy and begin requiring additional legal processes similar to MLAT requests. This could lead to delays in recovering easily movable digital assets.
At the same time, questions continue regarding compliance practices. The International Consortium of Investigative Journalists reported that Cambodia-linked Huione Group transferred at least $408 million via Binance in November 2025. In April 2026, Senator Richard Blumenthal requested information from the DOJ and the Treasury Department regarding reports of more than $1 billion in transfers to Iran-linked wallets through Binance.
Scott Armstrong, a former DOJ Fraud Section official, warned that the proposed change could create unnecessary barriers for law enforcement. If Binance—controlling about two-fifths of the global spot crypto market—starts requiring formal requests, cross-border investigations may become slower and more complex.
