Crypto exchange Binance has been in the spotlight after online reports claimed the platform had mass frozen the crypto assets of all Palestinian wallets.
The news raised concerns among users and the crypto community, who criticized the alleged move. Amid the backlash, the exchange’s CEO, Richard Teng, has denied the allegations, claiming the story is not factual.
Binance Accused Of Mass Freezing Palestinian Funds
Earlier this week, online reports alleged that Binance, the largest exchange by trading volume, had mass-frozen the assets of its Palestinian users. The report, made by Noones CEO and Paxful co-founder Ray Youssef, stated that the exchange has “seized all funds from all Palestinians” as per the request of the Israel Defense Forces (IDF).
According to the CEO, the information came from “several sources. ” He also claimed that all appeals to retrieve the funds are being denied. To him, Binance’s actions suggest that users from Syria and Lebanon could be affected next.
NBCTF's letter allegedly used by Binance. Source: Ray Youssef on X
Moreover, he shared a document allegedly used by Binance to respond to the appeals. The letter, signed by the National Bureau for Counter Terror Financing (NBCTF) Chief, Paul Landes, allows Israel’s Minister of Defense to issue a “temporary seizure of property of a declared terrorist organization,” including cryptocurrencies:
According to the anti-terrorism law, cryptographic currencies that have been transferred by a declared terrorist organization constitute property of a declared terrorist organization, and cryptocurrency wallets to which it has been transferred to said property constitutes property that was directly used to commit a serious terrorist offense of providing a service or Establishing measures for a terrorist organization, as defined in the Law on Combating Terrorism, and therefore in accordance with the instructions, the Law allows the Minister of Defense to order their seizure by administrative order in preparation for their confiscation.
Youssef also revealed that the exchange seemingly asked Palestinians appealing to contact an email linked to the Israeli government. To the CEO, “Israel is putting massive pressure on Binance and all other exchanges to blanket seize the funds of ALL Palestinians.”
Richard Teng Addresses Controversial Measure
The crypto community quickly reacted to the news, criticizing the exchange for “against all ethos of the blockchain and crypto.” Many expressed disappointment with centralized exchanges (CEXes) for “looking out for themselves” and urged investors to safeguard their funds from these platforms.
Amid the backlash, Binance’s CEO addressed the situation. Teng denied the report, calling it FUD (Fear, Uncertainty, and Doubt) as “only a limited number of user accounts, linked to illicit funds, were blocked from transacting.”
Binance's CEO Addresses allegations. Source: Richard Teng on X
The CEO affirmed that the statements claiming they froze funds from all Palestinian users are incorrect and emphasized that the exchange complies with internationally accepted anti-money laundering legislation “just like any other financial institution.” Teng also stated that Binance hopes “for a lasting peace throughout the region.”
Despite the statement, many community members remain concerned about the exchange’s actions. Several Binance users called the decision “unacceptable,” stating there’s no guarantee the platform won’t “do this to another country’s citizens tomorrow.”
Others questioned the process to determine whether the funds were linked to illicit activity and the denial of appeals. Lastly, some distrusted the exchange and announced they would rather withdraw their funds.
Binance Coin (BNB) is trding at $544 in the three-day chart. Source: BNBUSDT on TradingView
Featured Image from Unsplash.com, Chart from TradingView.com
