After the cryptocurrency exchange Binance was fined $4.3 billion by the U.S. Department of Justice last year for violating money laundering and sanctions regulations, it is now facing a class action lawsuit in the United States. Even its founder and former CEO Changpeng Zhao (CZ) Also among the defendants.
Comprehensive foreign media reports, three former Binance users Philip Martin, Natalie Tang and Yatin Khanna filed a class action lawsuit against Binance and Changpeng Zhao in the Seattle Federal Court on August 16, accusing Binance of laundering money for criminals through its own platform and causing harm to consumer interests.
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." It allows 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.
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) .
However, Binance has 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 $73 million in funds, of which about 80% was related to external hacker attacks. , vulnerabilities and theft related.
In response to this class action lawsuit, Bill Hughes, director of global regulatory affairs at Consensys, analyzed that he was skeptical that these accusations could be established on the grounds that the plaintiff must be able to prove that Binance is indeed responsible for these illegal activities.
He pointed out that after the U.S. government filed charges against Binance, this new class action lawsuit, although it is a "natural and foreseeable follow-up civil lawsuit," also puts Binance into a "difficult situation."
Bill Hughes believes that if the case develops further, it may have a significant impact on the cryptocurrency industry. He said:
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 tricky situation for those who care about the cryptocurrency industry.
〈Allow hackers to “launder” stolen assets? Binance, Changpeng Zhao face class action lawsuit in the United States> This article was first published on "Block Guest".