‘False News is Temporary’: CZ Reacts as Court Dismisses Terrorism Lawsuit Against Binance

A federal judge in Manhattan has dismissed a sweeping civil lawsuit that sought to hold Binance, Binance.US, and founder Changpeng “CZ” Zhao liable for transactions that plaintiffs claimed helped terrorist groups carry out 64 attacks worldwide between 2017 and 2024.

U.S. District Judge Jeannette Vargas ruled on Friday, March 6, that the 535 plaintiffs—comprising victims and relatives of victims—did not plausibly allege that Binance or Zhao had culpably participated in or sought to bring about the terrorist attacks in question. 

The plaintiffs had attributed the attacks to foreign terrorist organizations (FTOs), including Hamas, Hezbollah, Iran’s Revolutionary Guard, Islamic State, Kataib Hezbollah, Palestinian Islamic Jihad, and al-Qaeda, according to Reuters.

The judge noted that while Binance and Zhao may have been generally aware of the exchange’s role in certain activities, the only relationship between the defendants and the FTOs was an arm’s-length one—meaning accounts that transacted on the Binance exchange, not a deliberate partnership. 

Judge Vargas also called the 891-page, 3,189-paragraph complaint “wholly unnecessary” despite what she described as “weighty” allegations. The plaintiffs have been given leave to amend their complaint.

CZ Fires Back: ‘Absolutely Zero Motive’

Within hours of the ruling, Zhao posted on X, quote-tweeting his attorney Teresa Goody Guillén’s statement and adding his own pointed commentary.

“False news is temporary. Truth always comes with time.”

“Adding some logic here. There are absolutely zero (0) motive for any CEX to have anything to do with terrorists. I imagine they don’t actively trade (no fee revenue). They may try to deposit and then immediately withdraw (these don’t generate any revenue either).”

Zhao also made a personal reference to the geopolitical context, noting that he has seen “missiles being intercepted in the sky with my own eyes, while living in the safest country in the world”—a reference to his residence in the UAE during the ongoing U.S.-Iran conflict—underscoring his personal proximity to the very security threats the lawsuit invoked.

Guillén, who is a partner at BakerHostetler and also represents World Liberty Financial, said in her statement that the court recognized the lack of credibility in the plaintiffs’ claims, adding that it would be better if such baseless claims were not brought in the first place.

Binance’s Official Response

Binance itself also weighed in. The exchange posted on X confirming the court’s decision, stating it was “pleased to see that the court in this case correctly dismissed these baseless allegations.” The exchange emphasized that it “takes compliance seriously and has no tolerance for bad actors on its platform.”

Binance also shared a detailed statement elaborating on the ruling and the company’s compliance posture. The response comes at a critical moment for the exchange, which has been simultaneously defending against accusations from The Wall Street Journal, a Congressional inquiry from Senator Blumenthal, and multiple overlapping civil lawsuits—all while asserting that its compliance infrastructure has been overhauled since the 2023 DOJ settlement.

The Backstory: A Year of Legal Battles Over Terrorism Claims

This dismissed lawsuit was one of multiple civil cases seeking to tie Binance to terrorism financing. 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 FTOs on what the complaint described as an “industrial scale.”

Zhao previously disclosed that he had been threatened by a plaintiff demanding $4.4 billion, or they would allegedly have the media publish fabricated stories linking Binance to terrorists. 

In court papers in the dismissed case, Binance and Zhao said they condemned terrorism, with Zhao accusing the plaintiffs of attempting to “piggyback” on Binance’s November 2023 guilty plea and $4.3 billion criminal penalty for AML and sanctions violations to justify triple damages under the federal Anti-Terrorism Act, according to Reuters.

Wider Compliance Context

The ruling arrives during an intense period of scrutiny over Binance’s compliance record. Just days ago, Binance sent a formal letter to U.S. Senator Richard Blumenthal’s office denying allegations from The Wall Street Journal, The New York Times, and Fortune that the exchange facilitated $1.7 billion in transactions linked to Iranian entities. Binance called the reports “demonstrably false.”

CEO Richard Teng has maintained that Binance’s sanctions-related exposure dropped 96.8% between January 2024 and July 2025, and that the exchange now employs over 1,500 compliance staff worldwide with more than 25 monitoring tools. Earlier in February, Teng formally demanded that the WSJ retract its reporting, calling its claims “defamatory.”

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. He emphasized that he no longer runs Binance’s day-to-day operations.

For Zhao personally, Friday’s dismissal is a significant legal victory. He was pardoned by President Trump in October 2025 following his four-month prison sentence, but civil lawsuits have continued to pile on. Last October, a D.C. federal court also ruled that Zhao had not been properly served in a separate Hamas-related case, delaying his personal exposure in that litigation.

What Comes Next

While the dismissed case is a clear win for Binance, the legal landscape is not fully resolved. Judge Vargas granted the plaintiffs leave to amend their complaint, meaning a revised version of the lawsuit could be refiled. 

The separate Manhattan case (Raanan v. Binance) remains active after surviving a motion to dismiss in February 2025, and the North Dakota complaint filed in November 2025 is still in its early stages.

For the broader crypto industry, the ruling sets an important precedent. The court effectively drew a line between an exchange having users who may be associated with illicit activity—which, given the scale of platforms like Binance, is virtually inevitable—and the exchange itself being liable for the criminal actions of those users. That distinction matters as the industry continues to navigate U.S. anti-terrorism statutes that were originally designed for traditional financial institutions.

CZ’s logic—that no exchange has a financial incentive to service terrorists because such users generate no trading fees and simply attempt to move funds in and out—frames the argument in commercial terms that resonate with how the industry views its own compliance responsibilities. Whether courts in the remaining cases agree with that framing remains to be seen.

Also Read: Binance Denies of Allowing $1.7B Transactions Linked to Iran