A US federal court has dismissed a lawsuit accusing crypto exchange Binance of facilitating the financing of terrorism, ruling that the plaintiffs have not established the legal requirements necessary to hold the platform accountable under US anti-terrorism laws.
Conclusion
- A US federal court dismissed a lawsuit accusing Binance of facilitating the financing of terrorism, citing insufficient evidence linking the exchange to specific attacks.
- The court said the plaintiffs failed to show that Binance knowingly provided significant support to terrorist organizations.
- The judge gave the plaintiffs 60 days to amend their complaint and allowed the case to come back with new allegations.
Federal Court Dismisses Terrorist Financing Claim Against Binance
In an opinion issued on March 6, Judge Janet A. Vargas of the US District Court for the Southern District of New York granted the defendants’ request to dismiss the appeals of hundreds of victims and relatives of victims of terrorist attacks.
The plaintiffs, who were linked to 64 attacks worldwide between 2016 and 2024, alleged that Binance allowed accounts linked to terrorist groups and their intermediaries to operate on its platform. They alleged that the exchange’s services allowed these actors to transfer funds and were therefore aiding and abetting terrorism under the US Anti-Terrorism Act and the Justice Against Sponsors of Terrorism Act.
However, the court ruled that the complaint did not reasonably show that Binance knowingly provided significant support to terrorist organizations.
According to the opinion, the allegations were largely based on allegations that some wallets associated with sanctioned groups used the exchange, but they failed to show that Binance was aware of these connections at the time.
Judge Vargas also found that the plaintiffs did not sufficiently link the alleged cryptocurrency transactions to the specific attacks alleged in the lawsuit. The court said the complaint relies on general allegations of terrorist use of digital assets, rather than specific allegations showing that funds transferred through Binance support the events cited by the plaintiffs.
Because of these deficiencies, the court concluded that the complaint did not meet the legal standard required for aiding and abetting liability under US anti-terrorism laws.
In dismissing the case, the judge gave the plaintiffs 60 days to file an amended complaint alleging deficiencies in the order. If they are successful in making stronger allegations, the case could proceed in federal court.
