Forfeiture complaint targets wallets tied to two Hong Kong-based firms
The U.S. Attorney’s Office for the Southern District of New York filed the civil-forfeiture complaint late Monday, seeking to seize cryptocurrency frozen in several digital wallets. Prosecutors said the wallets held proceeds of black-market sales of Iranian oil to buyers in China and that, in total, approximately $1.5 billion was sent to Iran through a series of interrelated accounts. The U.S. attorney’s office said some of the money moved through the U.S. financial system. It was not clear where the remainder of the proceeds are.
According to the complaint, Hexa Whale and Blessed Trust — which the office said portrayed themselves as ordinary crypto-services and trading companies — worked together to move money for Chinese companies in the petroleum sector. Prosecutors said the two firms were among several entities that used accounts “at Binance to conduct cryptocurrency transactions representing the proceeds of black-market sales of Iranian oil to buyers in China.” The complaint alleges the transactions were designed to obfuscate the funds’ source and ownership.
The money that prosecutors said reached Iran passed through a network of cryptocurrency accounts the Justice Department referred to as “Entity A.” Binance investigators also used the term “Entity A” in their internal investigation of the network, according to prior Wall Street Journal reporting. Binance has said transactions between “Entity A” and its clients passed through intermediaries before reaching the network.
A Binance spokesperson said the civil-forfeiture case is not against Binance and does not allege any wrongdoing by the exchange. “Binance has zero tolerance for sanctions violations or illicit activity, and Binance did not permit any transactions with sanctioned individuals,” the spokesperson said, adding that the company “will continue to cooperate with law enforcement on this matter.”
Binance removed Hexa Whale from its exchange in August 2025 and Blessed Trust in January after identifying the suspicious activity, taking what it described as appropriate compliance measures against both trading clients. Blessed Trust was a Binance business partner that provided payment services. Hexa Whale went dormant last year; neither company responded to requests for comment from The Wall Street Journal. Blessed Trust had previously said it operated in accordance with laws and regulatory requirements and carried out sanctions-screening procedures.
The forfeiture case follows Binance’s 2023 guilty plea to violating U.S. anti-money-laundering and sanctions laws, when the exchange agreed to pay a $4.3 billion fine and to operate under U.S. oversight. The exchange’s founder, Changpeng Zhao, served a four-month prison sentence on a related charge. President Trump pardoned Zhao last year.
The Wall Street Journal reported in February that investigators inside Binance had identified the Hong Kong-based companies’ movement of substantial sums through the exchange during 2024 and 2025 to a network funding the Islamic Revolutionary Guard Corps. The Journal also reported that several of the Binance investigators who raised concerns about Blessed Trust were forced out of the exchange. Binance has said the investigators were not fired for raising compliance concerns but left “based on individual circumstances.”
Binance filed a defamation lawsuit against the Journal over its previous reporting about Iran’s use of the exchange. A Journal spokesperson said, “We stand by our reporting.”
Separately, The Wall Street Journal reported in May that a network run by Iranian financier Babak Zanjani made $850 million in transactions over two years on Binance. Asked about Zanjani’s use of Binance, the company previously said it did not allow any transactions with individuals that were sanctioned and it took all appropriate actions once it identified them. A spokesperson for Zanjani said he has not “relied upon any cryptocurrency exchange for the purpose of money laundering or sanction evasion.”