Binance Denies Allegations of Confiscating All Palestinian Crypto Assets, Claims Only Accounts Related to Illegal Activities Are Restricted

Binance Freezes Palestinian Assets

According to an industry source, the world's largest cryptocurrency exchange Binance has frozen Palestinian assets at the request of Israel.

Ray Youssef, co-founder of P2P trading platform Paxful and CEO Noones P2P, posted on X on August 26 that Binance had confiscated Palestinian accounts at the request of the Israel Defense Forces (IDF). Youssef cited multiple sources, including a letter from the Israeli government:

“Binance has seized all Palestinian assets at the request of the IDF. They have refused to return these funds and have denied any claims.”

Youssef said the move is affecting all Palestinians, and predicted that other countries like Lebanon and Syria could suffer the same fate.

Binance cited a letter signed in November 2023 by Paul Landes, director of the Israeli National Countering Terrorism Financing Bureau, in response to a complaint from Palestinian users.

The letter, written in Hebrew, allows the Minister of Defense to order “the temporary seizure of assets of a terrorist organization,” including crypto assets. The letter reads:

“According to anti-terrorism law, cryptocurrencies transferred by a terrorist organization are the property of that terrorist organization, and the wallets that receive them are also the property of that organization.”

How does Binance respond to the spread of information?

In response to the accusations, Binance asserted that it only restricted a few accounts involved in illegal activities and that the number of users affected was insignificant. The exchange emphasized:

"There are some inaccurate statements surrounding this issue. Only a small number of user accounts involved in illegal activities are blocked from trading."

Binance also affirmed that it complies with "internationally recognized sanctions regulations, like all financial institutions," and expressed hope for a lasting peace in the region.

Binance CEO Richard Teng made a similar statement on social network X (Twitter).

Binance did not provide details on the number of users affected or the duration of the restriction. According to data from SimilarWeb, Palestine is a small market for Binance, accounting for about 0.05% of traffic over the past year, although that number has increased by more than 80% since August 2023. Some other jurisdictions with similar traffic rates include El Salvador (0.06%), Albania (0.06%), Malta (0.03%), etc.

In October 2023, Israel blocked Binance accounts used by Hamas used to solicit funding. By April 2023, Israeli authorities had also seized 190 Binance accounts that were also believed to be linked to Hamas and ISIS.

Other cryptocurrency service providers have taken similar action. In 2023, Tether blocked 32 addresses linked to terrorist activities in Israel and Ukraine. In coordination with Israel's National Counter-Terrorism Financing Bureau, Tether froze 873,118 USDT.