United States Senator Richard Blumenthal, a leading member of the Senate’s Permanent Subcommittee on Investigations, has launched an official inquiry into reports that the cryptocurrency exchange Binance processed $1.7 billion in transactions linked to Iranian-sanctioned entities and Russia’s so-called “shadow fleet.” Blumenthal, known for his active work on public safety and digital finance regulation, is demanding answers from the global crypto giant after recent allegations emerged.
Scope of the Senate Investigation and Information Requests
In a letter sent to Binance CEO Richard Teng, Blumenthal called for detailed disclosure of internal records regarding how these suspicious transactions occurred and what steps the company has taken in response. The investigation is set to focus not only on the $1.7 billion in transfers but also on whether Binance staff detected any signs of compliance lapses internally—and if so, how the company responded to these red flags.
Allegations Spanning Iran and Russia Connections
Reporting from notable outlets The New York Times and The Wall Street Journal revealed that Binance investigators have identified over 1,500 user accounts allegedly accessed from Iran. Funds transfers reportedly involved intermediaries such as Hexa Whale and Blessed Trust, ultimately tracing connections as far as organizations affiliated with Iran’s Islamic Revolutionary Guard Corps (IRGC). There are also claims that the transactions were linked to Russian vessels seeking to evade Western sanctions.
Blumenthal highlighted the severity of the repeated breaches in his official letter, stating:
Binance has engaged in repeated violations.
According to the senator, Binance stands accused of enabling the Iranian regime and its associates to circumvent sanctions, anti-money laundering safeguards, and other financial restrictions using its platform.
Controversy over Binance’s Compliance Policies
Binance’s leadership has responded to these allegations by asserting that its recent compliance measures have been highly effective. The company claims transaction volumes involving sanctioned entities plummeted by 96% from early 2024 through mid-2025. Binance maintains that trades linked to sanctioned parties make up only a small fraction of its overall exchange volume.
Among the concerns listed in Blumenthal’s letter were doubts over whether Binance has taken internal alerts seriously and fulfilled anti-money laundering obligations, especially after reaching a settlement with US authorities in 2023. The senator also underscored reports that employees responsible for flagging suspicious activities might have been dismissed, raising serious questions about the company’s broader compliance culture.
Binance has firmly denied all allegations of sanction violations, insisting that it systematically removes affected accounts from its systems and continues to collaborate with global regulatory bodies.
