US Federal Court Dismisses All Terrorism Support Claims Against Binance and CZ

A U.S. Federal Court has dismissed all claims in a significant anti-terrorism lawsuit against Binance and its founder, Changpeng Zhao. The lawsuit, which sought to hold the world's largest cryptocurrency exchange liable for facilitating transactions linked to terrorist organizations—specifically in the context of the October 7 attacks—represented one of the most severe legal threats to the company's reputation and financial standing. By dismissing the case in its entirety, the court has effectively signaled that the plaintiffs failed to establish a sufficient legal link between Binance’s platform operations and the specific acts of terrorism cited in the complaint.

This victory is particularly poignant for Binance as it continues to navigate a complex post-settlement landscape. In late 2023, Binance reached a historic $4.3 billion settlement with the U.S. Department of Justice (DOJ) and other agencies over Anti-Money Laundering (AML) and sanctions violations. While that settlement addressed regulatory failures, this civil lawsuit attempted to extend that liability to direct responsibility for the actions of groups like Hamas. The court's decision to dismiss these claims suggests a high bar for 'material support' in the context of digital asset exchanges, reinforcing the principle that platforms are not automatically liable for the illicit activities of their users unless a direct, proximate cause can be proven.

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In late 2023, Binance reached a historic $4.3 billion settlement with the U.S.

From an industry perspective, the ruling provides a much-needed precedent for the broader crypto sector. Exchanges have long feared that being labeled as 'tools for terrorism' could lead to insurmountable legal liabilities and permanent exclusion from the global financial system. The dismissal helps decouple the exchange's past compliance failures—which it has already paid for and is currently remediating under federal monitoring—from the more extreme allegations of intentional or negligent support for global terrorism. It allows Binance to argue that while its past systems were flawed, it was never a willing or legally responsible participant in the financing of violence.