Binance CEO dismisses ‘FUD’ over alleged freezing of Palestinian crypto wallets

Share this article

Recently, allegations surfaced that Binance froze the assets of Palestinian users following a request from the Israel Defense Forces (IDF).

These claims are based on a purported Israeli government document citing an administrative seizure order under the Counter-Terrorism Act. The document indicates that the seized funds were linked to organizations labeled as terrorists, with the authorization of the Israeli Defense Minister.

Richard Teng, CEO of Binance, responded to concerns about the freezing of Palestinian exchange accounts by labeling the reports as “FUD” (Fear, Uncertainty and Doubt).

FUD. Only a limited number of user accounts linked to illicit funds were blocked from trading. There have been some incorrect claims about it.

As a global cryptocurrency exchange, we comply with internationally accepted anti-money laundering legislation, just like any other…

— Richard Teng (@_RichardTeng) August 28, 2024

“FUD. Only a limited number of user accounts linked to illicit funds were blocked from trading. There have been some incorrect statements about it,” Teng said.

The crypto exchange recently took steps to freeze certain Palestinian accounts following an order from Israeli authorities. The Israeli government has alleged that these accounts were used to fund organizations it considers “terrorist entities,” apparently in violation of anti-terrorism laws.

Government control over digital assets

Governments are increasingly examining digital assets as potential tools for financing activities they consider threats to national security.

For crypto exchanges like Binance, the situation underscores the complex regulatory landscape they must navigate. These platforms face increasing pressure to implement robust anti-money laundering and counter-terrorist financing measures while balancing user privacy concerns.

Teng’s response reflects Binance’s attempt to maintain its market position amid regulatory challenges. By framing the account freeze as a standard compliance practice rather than a targeted action, the exchange aims to reassure its user base and avoid potential reputational damage.

counter-narrative

The CEO’s statement aims to counter narratives suggesting that Binance may be unfairly targeting Palestinian users. Instead, Teng emphasized that the stock exchange’s actions are part of its global compliance efforts and are applied uniformly across jurisdictions.

Israel’s order to freeze these accounts is part of a broader initiative to disrupt financial networks believed to support terrorism. The government is now pushing for the permanent seizure of assets held in these frozen accounts, arguing that given the nature of the charges, the funds should be seized in full and not just frozen.

Despite the fact that the document does not explicitly name Binance, the crypto community has expressed significant outrage, particularly due to the platform’s history of compliance with Israeli law enforcement.

Ray Youssef, former CEO of Paxful and current CEO of P2P marketplace Noone App, commented, claiming that there was indeed a freeze.

“This is 100% confirmed. Israel is putting massive pressure on Binance and all other exchanges to seize ALL Palestinians’ funds. The document in the original post has 500 names, but there have been many such versions of it with many other names,” Youssef told X.

Further exacerbating the community’s concerns, the screen-recorded video shared by Youssef allegedly showed a message from Binance’s customer service confirming that the freezing of a Palestinian user’s account had been ordered by Israeli law enforcement. This incident has intensified calls for Binance to clarify its position amid growing distrust.

Historically, Binance has cooperated with Israeli authorities, including seizing accounts linked to Hamas and the Islamic State in counter-terrorism efforts. However, the current allegations could drive users to decentralized platforms, underscoring the crypto mantra: “Not your keys, not your coins.

Share this article