Circle Refutes Terror Funding Claims Amid Regulatory Scrutiny

Stablecoin issuer Circle refuted accusations from a Washington watchdog group that it supports terrorist organizations, particularly Hamas. The company is facing increased scrutiny and regulatory attention in the U.S. regarding its alleged connections with Hamas and controversial figure Justin Sun.

Circle rejects any wrongdoing and emphasizes its commitment to stringent compliance standards in the crypto industry.

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Justin Sun Controversy

Justin Sun, founder of TRON and an advisor at Huobi, has been a focal point of controversy. Information has circulated suggesting his affiliation with Circle, portraying it as his "bank." Circle explicitly clarifies that it does not bank Sun or its associated entities, including HTX and the Tron Foundation.

The company claims it terminated all accounts linked to Justin Sun in February, despite the absence of specific U.S. government designations. This statement comes in response to recent reports implicating the Tron blockchain in financing terrorist activities. 

Sun defended Tron, highlighting its decentralized structure akin to Bitcoin and Ethereum and its commitment to combating terrorist financing.

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Regulatory Compliance

Circle reaffirms its compliance with the Bank Secrecy Act and related laws aimed at fighting money laundering and terrorism financing in response to concerns raised by the Campaign for Accountability. The company vehemently denies supporting or financing illicit actors like Hamas directly or indirectly.

The open letter from Circle counters claims made in a Nov. 9 letter from the Campaign for Accountability, which alleged extensive ties between Circle and Sun's Tron Foundation. Additionally, it claimed that Sun's cross-chain protocol, SunSwap, is often used for money laundering.

The broader context includes allegations of cryptocurrency being used to finance terrorism, particularly during the Israeli-Hamas conflict. Reports initially suggested over $130 million in crypto donations to terrorist organizations, but subsequent corrections clarified the figure to be $12 million, stating it "may have been" sent to these organizations.