DOJ warns prosecutors of weaker Binance help, rattling global crypto enforcement

Binance, which makes up about 39% of the overall spot trading volume for cryptocurrencies in the month of May, may become harder for investigators to depend on in the near future.

The Information, which looked over an internal memo from the US Department of Justice (DOJ), stated that prosecutors dealing with cases regarding cryptocurrency were informed in June that cooperation from Binance may be less than wanted. It has been said that Binance intends to add conditions before fulfilling requests regarding freezing and seizing customer assets.

This raises concerns for the digital asset industry as a whole. Being the largest cryptocurrency exchange in the world, Binance has proven to be an essential ally in the pursuit of tracking, freezing, and recovering illicit digital assets that were obtained by way of hacking, ransomware, violating sanctions, and fraud. Any decrease in the willingness to cooperate voluntarily is bound to draw the investigations and retrieval of the assets to a halt.

The memorandum was reportedly written by Rachel Jones, who serves as DOJ digital currency counsel, and then disseminated among the people dealing directly with cryptocurrency cases. It also included copies of the memo for some high-level employees, including Kevin Mosley who was involved in the investigations of Binance in 2023.

Binance contest this interpretation of events, with its spokesperson saying:

There has been and will be no change to Binance’s cooperation with U.S. law enforcement.

In a different interview with BeInCrypto, the company’s head of corporate communications stated that the DOJ officials seem to have misinterpreted Binance’s responsibilities under the Abu Dhabi licensing structure and that the company has reached out to both the DOJ and Abu Dhabi officials to clear the matter.

The Abu Dhabi wrinkle

The cause of the misunderstanding, according to Binance, is the license which the company received from the Abu Dhabi Global Market (ADGM) where regulation started on Jan. 5, 2026.

According to the official guidance from the ADGM Office of Data Protection, the exemption allowing for necessary disclosures “would not extend to cover requests from law enforcement agencies outside of the UAE.”

If read narrowly, it may mean requiring international authorities to submit requests in accordance with the Mutual Legal Assistance Treaty (MLTA) rather than relying on the voluntary cooperation of Binance for immediate asset freezing.

However, the provided guidance allows for transfers needed for the “establishment, exercise or defence of legal claims (including judicial, administrative, regulatory and out-of-court procedures).”

The guidance even gives an example of said provision with reference to the request of a US regulator. Binance insists that this allows the company to continue its cooperation with American law enforcement while still complying with the privacy laws of the UAE, saying:

“We are not going to change in any way, shape or form, the way that we interact with law enforcement in America.”

The firm’s head of corporate communications stated to BeInCrypto that the firm is expanding its cooperation with the DOJ, not decreasing it.

Why voluntary help carries weight now

This issue has taken on greater importance because many of the supervision procedures that were put in place following Binance’s landmark settlement in 2023 have been relaxed significantly.

In November 2023, Binance accepted its guilt regarding the violations of the Bank Secrecy Act including operating an unauthorized money transmitting firm and violations of the sanctions.

The firm agreed to pay penalties worth more than 4.3 billion dollars and accept three years of independent compliance monitoring. As per the plea agreement, Binance also consented to “cooperate fully” with law enforcement agencies in the United States and across the globe.

Since that time, the Department of Justice has suspended many corporate monitoring programs, while the memo that Deputy Attorney General Todd Blanche issued in April 2025 ended what it called “regulation by prosecution” of digital assets and led to the closure of the National Cryptocurrency Enforcement Team.

The internal memo, as stated by The Information, read that Binance is going to stop “courtesy freezes” and will need additional legal processes including MLAT requests sometimes before making the decision on specific asset freezing or seizing requests. If the idea is implemented, then the investigators may have to wait longer to recover potentially movable digital assets.

Yet, problems regarding compliance remain. The International Consortium of Investigative Journalists reported that the Cambodia-linked Huione Group transferred at least $408 million through Binance in November 2025, while the exchange was being monitored by court officials. In April 2026, Senator Richard Blumenthal asked the DOJ and Treasury for information regarding reports that more than $1 billion was sent via Binance to wallets linked to Iran.

Scott Armstrong, former official of the DOJ Fraud Section, said the rumored changes could lead to “an additional and quite frankly unnecessary hurdle that is going to cause a lot of problems in the law enforcement community.”

What to watch

Binance has disclosed that it has raised the matter of the DOJ memo with officials from the department in its effort to end the monitorship imposed on it by the court. Whether the disagreement results from a fundamental misunderstanding of the privacy laws in ADGM or represents a change in operational procedures could seriously impact the cross-border cryptocurrency enforcement.

Given that Binance is currently responsible for two-fifths of the global market of centralized spot cryptocurrency trading, law enforcement entities have started to depend more and more on the cooperation of Binance in freezing stolen or sanctioned asset in an efficient manner. Should there be a need for more formal requests to be made, the process of international investigations will become a lot slower and more complicated.

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