Hamas Military Wing Directs Donors to Bybit, OKX Over Binance

The military wing of Hamas has publicly directed supporters and donors to shift their cryptocurrency activity away from Binance and toward alternative exchanges including Bybit and OKX, citing regulatory pressure that has made Binance a riskier platform for illicit transactions.

The advisory, reported Wednesday, is a direct acknowledgment by a U.S.-designated foreign terrorist organization that compliance enforcement at major exchanges is working. Binance has spent the past several years overhauling its anti-money laundering (AML) and know-your-customer (KYC) infrastructure following a landmark 2023 settlement with the U.S. Department of Justice and Treasury Department, which included a $4.3 billion penalty and the resignation of founder Changpeng Zhao. The compliance investment appears to have made the platform materially less useful to sanctioned actors.

The shift is textbook regulatory arbitrage. When enforcement pressure concentrates on the largest, most visible platform, illicit flows migrate toward exchanges with lighter compliance footprints or less robust screening against the U.S. Treasury's Office of Foreign Assets Control (OFAC) sanctions lists. OFAC designates individuals, entities, and wallets associated with terrorism financing, and exchanges are legally required to block sanctioned counterparties from transacting. By naming Bybit and OKX as preferred alternatives, Hamas' military wing is effectively publishing a compliance gap analysis of the crypto exchange landscape.

Both Bybit and OKX are likely to push back hard on any implication that their platforms are permissive toward sanctioned entities. The two exchanges operate globally and have each made public commitments to regulatory compliance, including cooperation with law enforcement requests. Neither is a fringe platform: Bybit ranked among the top three derivatives exchanges by open interest for much of 2025, and OKX consistently places in the top five for spot trading volume. Their scale alone means they face significant regulatory exposure in the European Union, where the Markets in Crypto-Assets (MiCA) framework is now fully in force, and in other major jurisdictions. Being named in a Hamas advisory creates direct reputational and legal pressure to demonstrate that their screening procedures are effective.

The practical impact on Hamas funding flows may be limited. Cryptocurrency analysts and U.S. officials have long noted that terrorist financing through crypto, while real, remains a small fraction of overall illicit finance globally. Traditional channels including hawala networks, cash couriers, and correspondent banking continue to move far larger sums. The advisory also assumes a level of technical fluency among donors that may not be widespread.

Still, the public nature of the guidance matters. It is documented evidence that a designated terrorist organization views certain exchanges as more accommodating than others, and that calculus is now part of the public record.

For regulators, the episode reinforces a familiar argument: compliance pressure on one platform does not eliminate illicit activity, it displaces it. The question facing policymakers in Washington, Brussels, and beyond is whether to accelerate licensing and AML requirements for mid-tier exchanges before those platforms become the preferred infrastructure for sanctioned actors. The Financial Action Task Force (FATF) has pushed member states to apply its Travel Rule, which requires exchanges to share sender and recipient data on transactions above certain thresholds, but implementation remains uneven across jurisdictions. That unevenness is precisely the gap that advisories like this one exploit.

Binance has not publicly commented on the Hamas advisory as of Wednesday. The company's compliance team, which has grown substantially since the 2023 settlement, routinely cooperates with OFAC and law enforcement agencies on sanctions screening. The advisory is, in a perverse sense, a measure of how far the exchange has come on compliance since the period when it was itself the subject of Treasury enforcement action.

Exchanges that invest in compliance infrastructure become less useful to bad actors. Exchanges that do not, or that operate in regulatory gray zones, risk becoming the next named platform in a terrorist organization's funding guide. That is not a hypothetical reputational risk. It is now a documented one.