US Senate Democrats Push for DOJ, Treasury Probe on Binance

Senate Democrats are escalating pressure on Binance, with nine lawmakers sending a letter on Friday to Treasury Secretary Scott Bessent and Attorney General Pam Bondi demanding a formal investigation into the exchange's sanctions compliance and illicit finance safeguards. The request follows news reports alleging that potential terrorism funding flowed through the platform and that Binance dismissed compliance employees who flagged the suspicious transactions.

Why Are Senate Democrats Calling for a Binance Investigation?

The probe demand stems from mounting concerns that Binance's anti-money laundering protections remain inadequate despite its 2023 settlement with U.S. authorities. Senators Elizabeth Warren, Ruben Gallego, Angela Alsobrooks, Mark Warner, and five other Democrats signed the letter, citing media reports that enormous sums may have reached terrorist organizations or sanctions evaders through the exchange.

"These allegations raise grave concerns that poor illicit finance controls at Binance remain a significant threat to national security," the senators wrote in their Friday letter. They warned that America's defenses are "dangerously compromised if enormous sums can flow through Binance to terrorist groups or sanctions evaders." The lawmakers also demanded details on Binance's compliance with the terms of its 2023 plea agreement with federal prosecutors.

These allegations raise grave concerns that poor illicit finance controls at Binance remain a significant threat to national security.

— Nine Democratic Senators, in a Friday letter to Treasury and DOJ

Blumenthal's Parallel Inquiry and Minority Constraints

The group letter follows a separate effort earlier in the week by Senator Richard Blumenthal, a Connecticut Democrat and senior member of the Senate Homeland Security Committee, who independently wrote to Binance requesting information about the reported compliance failures, according to a public statement.

However, neither Blumenthal nor his Democratic colleagues hold majority status, meaning they lack the procedural authority to launch formal committee investigations or issue subpoenas. Binance co-CEO Richard Teng has pushed back against the claims, calling some of the media reports "inaccurate" and "defamatory," according to earlier remarks. A company spokesperson did not immediately respond to a request for comment on Friday regarding the senators' correspondence.

Trump Ties and the CZ Pardon

The Democratic senators also flagged connections between Binance and President Donald Trump's crypto interests, noting that the exchange maintains ties to World Liberty Financial, the Trump-backed venture responsible for the USD1 stablecoin. They further cited Trump's presidential pardon of Binance founder Changpeng "CZ" Zhao, who had pleaded guilty and served four months in prison for anti-money laundering and know-your-customer violations at the exchange.

Impact on Crypto Legislation Talks

The letter arrives at a sensitive moment, as Congress continues to negotiate the Digital Asset Market Clarity Act, sweeping legislation designed to establish a comprehensive regulatory framework for U.S. cryptocurrency markets. Prevention of illicit finance through digital assets remains one of the most contentious unresolved provisions in the bill, and Senator Mark Warner has taken a lead role among Democrats crafting the relevant language.

The senators specifically noted they "recognized" Binance's relationship with the Trump-affiliated venture, signaling that the issue could become a flashpoint as the bill advances toward a potential floor vote. The intersection of the Trump family's crypto activities and the ongoing regulatory debate has added yet another layer of complexity for negotiators on both sides of the aisle.