Binance closed 2025 as the most dominant crypto exchange with about 45% market share, but with a couple of scars that will likely extend into 2026.
The market crash on 10 October sparked some community resentment as some called for investigations. Additionally, the Binance [BNB] exchange faced allegations of money laundering and terrorist financing.
However, can the legal challenges derail the exchange. Especially its U.S. subsidiary in 2026?
Binance 2025 woes
The 10 October crash destroyed the market structure and traders’ morale. In fact, most experts, including Kaiko Research analysts, pointed out that Binance’s liquidity dominance is a risk.
Any failure in its systems could swiftly affect the entire crypto market, as seen in the 10 October crash.
About $20 billion worth of positions were wiped out during the liquidation cascade that Binance linked to a system “glitch.” However, the series of compensations the exchange made afterwards was viewed by critics as an admission of guilt for wrongdoing.
In fact, Kris Marszalek, founder of Crypto.com, and other VCs openly called for an investigation into Binance and other exchanges that liquidated traders.
Source: X
At the time of writing, there was no official lawsuit against Binance on the alleged market crash.
Still, the exchange faced other legal headwinds in 2025. The families and victims of the terror attack on Israel on 07 October, 2023 sued the exchange and founder CZ.
The victims claimed that the terrorists used Binance to move illicit funds that funded the attack. The case was filed, but no trial date has been set so far.
What’s next for Binance
Additionally, Binance and the presidential pardon of its founder, Changpeng Zhao, “CZ”, sparked “corruption claims” from Democrats led by Senator Elizabeth Warren.
Even so, the SEC dropped the case against the exchange for operating an unregistered securities exchange in June 2025. The case was dismissed with prejudice, meaning that it can’t be refiled.
However, it remains to be seen whether the terror link and October crash allegations will resurface in 2026.
Meanwhile, the exchange, especially the U.S subsidiary, has said it is betting on tokenization boom in 2026. Binance U.S. CEO Norman Reed recently added,
“We are focused on delivering a deeper, richer, and more rewarding digital asset experience.”
Final Thoughts
- Binance faced some regulatory challenges in 2025, but it is still unclear whether U.S operations will be affected.
- The October crash and terror link allegations were the main issues in 2025.