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Binance’s Role in Trump’s Cryptocurrency Endeavors
Recent reports indicate that Binance, a prominent cryptocurrency exchange, played a significant role in generating substantial profits for a cryptocurrency venture associated with the Trump family just prior to Donald Trump granting clemency to its co-founder. Changpeng Zhao, commonly known as “CZ,” received a pardon last week after the Trump administration claimed he was unjustly prosecuted by the Biden Administration amid its crackdown on cryptocurrency.
Zhao had previously admitted guilt regarding charges of facilitating money laundering and agreed to resign as Binance’s CEO in exchange for a settlement of $4.3 billion with the Justice Department in 2023, serving four months in prison as part of the resolution. Following Trump’s re-election in 2024, which he has promoted as supportive of cryptocurrency, Zhao’s firm reportedly perceived an opportunity.
Binance established a specialized team to negotiate with World Liberty Financial, a cryptocurrency project linked to the Trump family, and embarked on an extended effort to seek a pardon, as reported by the Wall Street Journal, citing informed sources.
World Liberty’s Surge Following Binance’s Involvement
The Trump family, through an overarching company, holds a majority stake in World Liberty Financial. The value of World Liberty’s new stablecoin—designed to maintain parity with the U.S. dollar—skyrocketed from $127 million to over $2.1 billion this spring, following Binance’s intervention. According to the Wall Street Journal, the technological foundation for World Liberty’s stablecoin, known as USD1, was developed by Binance. Shortly after USD1’s launch in March, an Emirati state-backed investment fund, MGX, utilized it to inject $2 billion into Zhao’s company, which reportedly positioned World Liberty to earn tens of millions in interest.
World Liberty clarified to the Wall Street Journal that Binance did not facilitate the transaction with MGX. Additionally, a Binance attorney stated that Zhao was not involved in arranging any financial relationships between MGX and the Trump family’s cryptocurrency venture.
Implications of Zhao’s Pardon for Binance
With Trump having pardoned Zhao, Binance, the leading cryptocurrency trading platform, is poised for a resurgence in the U.S. market following a ban imposed in 2023. World Liberty also remarked that discussions regarding the pardon were not held. Their attorney, Tom Clare, emphasized that the company had not played a role in influencing Zhao’s pardon decision. A spokesperson for World Liberty asserted that those victimized by the Biden administration’s legal actions deserved pardons.
Binance’s legal representative, Wayne F. Dennison, maintained that there had been no misconduct and that the choice of stablecoin by MGX was independent of Binance’s influence.
Concerns Surrounding the Pardon Decision
Trump indicated that the pardon was granted “at the request of many good people,” although the decision raised concerns among some officials in his administration, according to the Wall Street Journal. White House press secretary Karoline Leavitt stated that neither Trump nor his family has engaged in any conflicts of interest. Zhao was released from prison in September, and following Trump’s election victory, he and Binance co-founder Yi He, who is also his partner, were reportedly seen mingling with influential figures within Trump’s circle.
In December, the couple hosted a yacht gathering in Abu Dhabi during the Grand Prix, attended by notable guests, including Errol Musk, father of Elon Musk, and Bilal bin Saqib, a tech entrepreneur later associated with World Liberty. Reports suggest that Zhao also interacted with Eric Trump and Steve Witkoff, who now serves as Trump’s special envoy, at a bitcoin conference, although both World Liberty and a Trump administration representative have denied any meetings occurred at that event.
A few months later, in April, Zhao met with individuals linked to World Liberty, including Zack Witkoff, Steve Witkoff’s son, and Saqib, at a St. Regis beachfront restaurant. Zhao’s guilty plea was part of a settlement with the Justice Department, which had been investigating Binance for multiple legal violations, including failing to register as a money transmitter and not adhering to the Bank Secrecy Act.
Backlash Against Zhao’s Pardon
Federal authorities alleged that Binance failed to comply with legal requirements, enabling illicit activities, including money laundering by criminal organizations. Zhao admitted to lacking an adequate anti-money laundering program, which constituted a breach of the Bank Secrecy Act. Democratic Senator Elizabeth Warren condemned Trump’s decision to pardon Zhao, stating, “First, Changpeng Zhao pleaded guilty to a criminal money laundering charge. Then he boosted one of Donald Trump’s crypto ventures and lobbied for a pardon.” She stressed the need for Congress to address such corruption in upcoming market structure legislation.
Democratic Representative Jerry Nadler of New York echoed similar sentiments, asserting that Trump was essentially “selling pardons to those who can personally benefit him, which is a disgraceful abuse of power and undermines justice.” Even some of Trump’s supporters expressed criticism regarding Zhao’s pardon. Joe Lonsdale, co-founder of Palantir Technologies, expressed on social media that Trump had received poor advice, suggesting that the situation appeared to imply widespread fraud surrounding him.
Laura Loomer, a close associate of Trump, voiced her disapproval of the pardon before it was officially announced. She remarked, “You know who gets Emirati citizenship when they weren’t born in the UAE? People trying to evade punishment for crimes.” In response, Zhao stated that he no longer holds Chinese citizenship. Binance representatives contended that under a Trump-led administration, Zhao’s actions would not have warranted prosecution, as reported by the Wall Street Journal.
