Binance vs The Wall Street Journal Lawsuit, The Full Story Behind the Defamation Dispute
Binance has not formally filed a lawsuit against the Wall Street Journal — rather, it sent a formal legal letter through law firm Withers Bergman LLP in February 2026 demanding a full retraction and corrections to WSJ’s article alleging the crypto exchange violated Iranian sanctions. The dispute is ongoing, with Binance calling the reporting “false and defamatory.”
What Is This All About?
In late February 2026, the world’s largest cryptocurrency exchange, Binance, launched a fierce public and legal battle against The Wall Street Journal after the publication ran a story accusing the platform of breaching Iranian sanctions and retaliating against employees who raised compliance alarms. Binance called the reporting false, defamatory, and agenda-driven — and it wants a full retraction.
This is one of the most high-profile media confrontations in crypto history, putting press freedom, corporate reputation, and billion-dollar compliance obligations all in the same ring.
The WSJ Article That Sparked the Fight
What the Wall Street Journal Reported
The WSJ article, published on Monday, February 23, 2026, alleged that internal Binance investigators had traced funds moving to “a network funding Iran-backed terror groups,” and claimed the exchange dismantled the probe and fired the staff involved once those findings emerged.
The Journal’s article said the crypto exchange fired staff investigators who identified $1 billion that moved to “a network funding Iran-backed terror groups,” and claimed to have Binance documents and statements from people familiar with Binance operations.
The news report also mentions $1.7 billion in 2024 and 2025 that were transferred from Binance-registered Chinese clients to Iran-backed groups, including Yemen’s Houthi militants.
It Wasn’t Just the WSJ
The New York Times released a similar report the same day, stating that $1.7 billion flowed from two Binance accounts to Iranian entities allegedly tied to terrorist groups. In addition, Fortune had already published a related story on February 13, also alleging sanctions violations and employee dismissals around the same transactions.
Both influential U.S. newspapers said the four individuals “fired” by Binance, who worked in compliance and market oversight roles, were dismissed after the crypto exchange concluded they had failed to adequately escalate red flags related to suspicious trading activity and potential policy violations.
Binance’s Response: The Legal Letter
Richard Teng Goes Public
On February 23, 2026, CEO Richard Teng stepped forward to formally contest the WSJ piece, attributing $1.7 billion in crypto activity to entities operating under Iranian sanctions. Binance didn’t stop at a press statement — the exchange sent a legal letter to the publication demanding both corrections and a full retraction.
The letter, sent by law firm Withers Bergman LLP, accused the WSJ of publishing false and misleading claims that damaged Binance’s reputation. Binance argued the article misrepresented its compliance actions and failed to include the company’s responses provided before publication.
The Core Legal Argument
Binance claimed its client “reasonably, cooperatively, and promptly” responded to a series of questions put forward by a WSJ journalist. However, it claimed the piece “fails to reflect” their responses and “falsely asserts to readers that Binance engaged in illegal conduct by breaching Iranian sanctions.”
Binance’s lawyers did not hold back in their characterization of the journalism involved: “While you solicited our client’s position, your failure to reflect our client’s responses is inconsistent with your ethical obligations to ‘remain fair, accurate and impartial’, and suggests an agenda already set, which does not amount to responsible journalism.”
The 19 Unanswered Questions
Teng added that the exchange had answered 19 detailed pre-publication questions from the WSJ reporter, and that none of those answers made it into the final piece.
Binance’s Counter-Narrative: What It Says Actually Happened
On the Fired Employees
Binance denied that any investigators were let go for raising issues with sanctions or compliance. According to a spokesperson, some employees departed on their own, but one was fired for disclosing internal user data without permission.
Binance’s position on the staff dismissals rests on a specific counter-narrative: the employees in question left following internal reviews connected to breaches of data protection and confidentiality obligations.
On the Hexa Whale and Blessed Trust Accounts
The inquiry focused on two Binance partners, Hexa Whale and Blessed Trust, reported to have indirect links to wallets connected to Iran. Binance said it found these risks after law enforcement contacted them in 2025. The company investigated the cases, reviewed transaction records, and gave information to authorities. Hexa Whale was removed from the platform in August 2025, and Blessed Trust in January 2026.
Binance added that no account on its platform directly sent money to Iran.
On the Technical Reality of Blockchain
One technical reality shapes how Binance — and every public blockchain exchange — handles scenarios like the one described. Anyone can send funds to a deposit address on a public chain without the platform’s advance consent. Pre-transaction blocking isn’t feasible in the same way it is in traditional banking. Exchanges instead depend on real-time surveillance, post-receipt controls, and cooperation with regulators to catch exposure after the fact.
The Compliance Data Binance Is Using to Fight Back
Sanctions Exposure Numbers
Binance backed up its defense with hard statistics:
- Sanctions-related exposure dropped from 0.284% of total exchange volume in January 2024 to just 0.009% by July 2025 — a 96.8% decrease.
- Binance highlighted its efforts to reduce exposure to Iranian cryptocurrency exchanges, cutting direct exposure by over 97.3% from $4.19 million to $110,000 between January 2024 and January 2026.
The Size of Binance’s Compliance Operation
More than 1,500 people carry compliance responsibilities at Binance as of early 2026, accounting for about a quarter of the entire global workforce. Of those, 593 hold full-time positions inside the dedicated Compliance unit, and 978 others support related functions across separate departments.
Binance reports investing hundreds of millions of dollars into personnel and systems over recent years, and currently holds licenses or authorizations in 20 jurisdictions, including a recent approval under the Abu Dhabi Global Market’s Financial Services Regulatory Authority.
Cooperation with Law Enforcement
In 2025 alone, Binance handled more than 71,000 law-enforcement requests. Over the past three years, authorities seized more than $752 million with assistance from the exchange.
CZ Weighs In
Former Binance CEO Changpeng “CZ” Zhao, who was pardoned by President Trump in late 2025 following his prison sentence, also pushed back publicly. Zhao echoed Teng’s message on X, saying: “Some media use negative narratives (from fired employees). Binance uses data. Best compliance program in the industry, by far!”
CZ himself has been on a broader counter-offensive against compliance-related allegations. In mid-February, he publicly slammed what he called “self-contradictory” claims about Binance’s compliance practices, arguing that the exchange relied on multiple independent AML and blockchain analytics providers during his tenure.
The Senate Gets Involved
The controversy didn’t stay confined to a media dispute. On February 24, Senator Blumenthal opened an inquiry into Binance following reports from the Wall Street Journal, the New York Times, and Fortune suggesting that the crypto exchange was complicit in “laundering money and enabling trade with Iranian government entities,” including Yemeni Houthis, Iran’s Islamic Revolutionary Guards Corps, and Russian shadow oil tankers. Blumenthal also accused Binance of skirting accountability through its financial partnership with President Trump’s World Liberty Financial.
In a formal reply to Blumenthal’s February 24, 2026 letter, Binance called the media reports “false, unsupported, and defamatory.”
According to Binance’s open letter, “the recent reporting on which [Blumenthal’s] inquiry relies… is demonstrably false, unsupported by credible evidence, and defamatory in several material respects.”
The Broader Legal Context: Other Lawsuits Binance Faces
This media battle is unfolding against a backdrop of multiple legal challenges:
- A separate lawsuit in Manhattan federal court, brought by families of the October 7, 2023, Hamas attack victims, survived an earlier motion to dismiss in February 2025 and remains active. In that case, Raanan v. Binance Holdings alleges that Hamas and Palestinian Islamic Jihad used the exchange to fund operations.
- A third lawsuit, filed in November 2025 in North Dakota federal court on behalf of 306 American plaintiffs, accused Binance of facilitating the transfer of over $1 billion to designated foreign terrorist organizations on what the complaint described as an “industrial scale.”
- In 2023, Binance pleaded guilty to violating U.S. sanctions and anti-money-laundering laws, agreeing to pay a record $4.3 billion penalty.
However, not all legal battles have gone against Binance. One of the terrorism-financing cases was dismissed, with the court effectively drawing a line between an exchange having users who may be associated with illicit activity and the exchange itself being liable for the criminal actions of those users.
Where Things Stand Now
Binance continues to press for corrections. Whether the WSJ moves on the retraction request remains to be seen, but the exchange has made clear it doesn’t plan to let the story stand without a documented fight.
A Binance spokesperson said the exchange conducted an “internal review and did not find evidence of violations of applicable sanctions laws or regulations related to the transactions described,” adding that suspicious activity was detected and reported, which is “evidence that our controls are working, not the opposite.”
The WSJ has not yet issued a retraction or correction as of this writing.
Key Takeaways
- The dispute centers on a February 2026 WSJ article alleging Binance fired compliance investigators probing $1 billion in Iran-linked transactions.
- Binance’s legal team sent a formal retraction demand via law firm Withers Bergman LLP, calling the reporting false and defamatory.
- Binance’s defense rests on hard compliance data — a 96.8% reduction in sanctions exposure, 1,500+ compliance staff, and 71,000 law enforcement requests handled in 2025.
- The fired employees, Binance says, were let go for data breaches — not for raising compliance red flags.
- U.S. Senator Blumenthal has since launched a Senate inquiry based on the same reports, which Binance has also formally contested.
- The WSJ has not issued a correction or retraction, and the standoff continues.
This story sits at the crossroads of crypto regulation, press accountability, and geopolitical finance — and it is far from over.
About the Author
Sarah Klein, JD, is a licensed attorney and legal content strategist with over 12 years of experience across civil, criminal, family, and regulatory law. At All About Lawyer, she covers a wide range of legal topics — from high-profile lawsuits and courtroom stories to state traffic laws and everyday legal questions — all with a focus on accuracy, clarity, and public understanding.
Her writing blends real legal insight with plain-English explanations, helping readers stay informed and legally aware.
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