Trump Grants Pardon to Binance Founder CZ, Ending 'War on Crypto'
In a significant move, U.S. President Donald Trump has issued a presidential pardon to Changpeng "CZ" Zhao, the founder of the cryptocurrency exchange Binance. This decision comes after Zhao served four months in prison earlier this year for violating the Bank Secrecy Act. The pardon has been framed by the Trump campaign as an end to the Biden administration's perceived "war on cryptocurrency."
Key Takeaways
- President Donald Trump has pardoned Binance founder Changpeng "CZ" Zhao.
- Zhao had previously pleaded guilty to violating the Bank Secrecy Act and served four months in prison.
- The White House stated the pardon ends the Biden administration's "war on cryptocurrency."
- Zhao expressed gratitude for the pardon, while critics raised concerns about corruption.
A Pardon Granted
U.S. President Donald Trump has granted Binance founder Changpeng "CZ" Zhao a pardon, months after the former exchange CEO confirmed he had sought such a reprieve. Zhao had previously pleaded guilty in November 2023 to charges related to violating the Bank Secrecy Act. As part of his plea agreement, he stepped down from his role at Binance and agreed to a $50 million fine. Binance itself pleaded guilty to charges and agreed to pay a record-breaking $4.3 billion in fines to various U.S. government agencies.
White House Statement and Trump's Remarks
White House Press Secretary Karoline Leavitt issued a statement asserting that Zhao had been "prosecuted by the Biden Administration in their war on cryptocurrency." She argued that the administration pursued Zhao despite no allegations of fraud or identifiable victims, and that the requested three-year prison sentence was unusually harsh. Leavitt concluded that these actions "severely damaged the United States’ reputation as a global leader in technology and innovation" and declared, "The Biden Administration’s war on crypto is over."
When questioned about the pardon, President Trump stated, "A lot of people said that he wasn't guilty of anything... They said that what he did is not even a crime, it wasn't a crime, that he was prosecuted by the Biden administration, and so I gave him a pardon at the request of a lot of very good people."
Background of the Case
Federal prosecutors had alleged that Binance employees were aware of their violations of the Bank Secrecy Act, citing internal communications. The exchange was accused of serving users in sanctioned countries and facilitating transactions between U.S. users and those in sanctioned nations. Court filings indicated that Binance employees discussed strategies to circumvent Know Your Customer (KYC) requirements for U.S. users, with Zhao reportedly authorizing and directing such approaches.
The exchange was also identified as a platform used by illicit actors, with significant sums from darknet marketplaces and mixing services linked to Binance. Executives were reportedly aware of these illicit activities.
Implications and Reactions
A presidential pardon could allow Zhao to conduct more business operations within the U.S. The cryptocurrency market reacted positively to the news, with Binance's native token, BNB, seeing a modest increase.
However, the decision drew criticism. Senator Elizabeth Warren, a prominent Democrat on the Senate Banking Committee, stated, "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. Today, Donald Trump did his part and pardoned him. If Congress does not stop this kind of corruption in pending market structure legislation, it owns this lawlessness."
A Binance spokesperson expressed gratitude for the pardon, stating, "Incredible news of CZ’s pardon today. We thank President Trump for his leadership and for his commitment to make the US the crypto capital of the world."