Binance, the world's largest cryptocurrency exchange, reached a settlement agreement with the U.S. Department of Justice, the Commodity Futures Trading Commission (CFTC) and other agencies in November last year, pleading guilty and agreeing to pay a $4.3 billion fine. Founder CZ(CZ) admitted He resigned as CEO of Binance and paid a fine of US$175 million after violating U.S. anti-money laundering laws and other charges.
In May this year, the U.S. District Court in Seattle finally sentenced CZ to four months in prison. He is still serving his sentence and is expected to be released from prison at the end of September.
Binance and CZ are hit with another class action lawsuit
However, according to a report by Cointelegraph yesterday (21st), three former Binance users Philip Martin, Natalie Tang and Yatin Khanna filed a class action lawsuit against Binance and CZ in the Seattle Federal Court on August 16, accusing Binance of using Its own platform launders money for criminals and harms the interests of consumers.
The plaintiffs claimed that after the theft, their cryptocurrency was transferred to Binance by attackers in an attempt to "erase the transaction records of digital assets" and make the funds "untraceable." They also alleged that "Binance serves as a cryptocurrency money laundering empire." Allow hackers, thieves and other criminals to launder their illegal gains on the platform. Otherwise, based on the transparency of blockchain transactions, the authorities would have been able to recover their stolen assets in a timely manner:
Therefore, without a venue like Binance to launder cryptocurrencies, when a criminal steals other people’s cryptocurrencies, there is a chance that authorities will eventually track them down by tracing their footprints on the blockchain.
The lawsuit alleges that Binance played an "important role" in the money laundering process and used it to obtain huge profits, and that Binance's actions also constituted "illegal extortion" and violated the Racketeer and Corruption Organized Crime Act (RICO Act) .
Lawyer's point of view
In response, Bill Hughes, senior legal counsel and director of global regulatory affairs at Ethereum development company Consensys, posted on the social platform , may also have a significant impact on the encryption industry:
If the case enters an in-depth investigation stage or even enters a decisive pre-trial motion, then blockchain analysis and the effectiveness of on-chain asset recovery will become the focus of the trial and attract the attention of relevant law enforcement agencies.
Binance may be forced to respond to tracking and asset recovery issues, which is indeed a thorny issue for those who care about the cryptocurrency industry.
However, Bill also added that he is skeptical about whether these accusations can be established, because the plaintiff must be able to prove that Binance is indeed responsible for these illegal activities:
This new class action lawsuit is an apparently natural and foreseeable follow-up to civil litigation following the U.S. government’s charges against Binance.
Binance has also actively adopted security measures in recent years and continues to assist users in recovering and freezing stolen assets. In 2024 alone, it successfully recovered more than US$73 million in funds , of which approximately 80% was related to external hacker attacks and vulnerabilities. related to theft. Such an attitude may also make the judge believe that at least Binance is not a murderer who assists the crime subjectively.
From the author's point of view, there is actually no shortage of channels for criminals to launder money on the chain. Transfers to centralized exchanges like Binance may be frozen. Therefore, whether the plaintiff's accusation is reasonable remains to be heard by the court.
