Crypto-exchange Binance founder Changpeng Zhao receives pardon from Trump amid money laundering admission
Zhao's legal troubles began when Binance was accused of violating US anti-money laundering laws and sanctions programs.
US President Donald Trump has granted a pardon to Changpeng Zhao, founder of Binance, the world’s largest cryptocurrency exchange. Zhao had previously served prison time after pleading guilty to failing to implement an anti-money-laundering program, which allowed criminal activities—including child exploitation, drug trafficking, and terrorism—to be facilitated through the platform.
Controversy over ties to Trump ventures
Despite the gravity of the charges, Trump granted the pardon following Zhao's request, a decision that has raised questions due to Zhao's ties to World Liberty Financial, a crypto venture launched by Trump and his sons in September.
World Liberty Financial has introduced USD1, a stablecoin pegged to the US dollar.
Trump’s financial gains
AP reported that Trump's latest financial disclosure reveals that he earned over $57 million last year from World Liberty Financial.
White House defends pardon
White House press secretary Karoline Leavitt stated that the Biden administration's prosecution of Zhao was politically motivated, aiming to punish the cryptocurrency industry. She emphasized that there were "no allegations of fraud or identifiable victims," despite Zhao's guilty plea. Zhao expressed remorse in court, stating, "I failed here. I deeply regret my failure, and I am sorry."
Zhao’s prison sentence
In 2024, Zhao served a four-month prison sentence after pleading guilty to failing to implement sufficient anti-money-laundering controls at Binance.
Trump-linked crypto venture supported by Binance
One of Trump’s cryptocurrency ventures has received behind-the-scenes support from Binance. According to a Bloomberg report, Binance provided the basic code for USD1, a stablecoin launched by the Trumps’ World Liberty Financial Inc. The work involved writing the “smart contract” that governs how USD1 tokens are created, enabling its use in a $2 billion transaction this spring when a UAE-based investment firm purchased a stake in Binance. Sources familiar with the matter, who spoke anonymously due to the private nature of the arrangement, confirmed Binance’s involvement.
Changpeng Zhao pleaded guilty in 2023 to failing to maintain an effective anti-money-laundering program. He has publicly said that he has applied for a presidential pardon. The arrangement raises questions about a potential conflict of interest, as both Zhao and Trump are key figures in the involved firms.
Binance’s role in USD1
Blockchain data, public announcements, and insider accounts indicate that Binance not only helped create USD1 but also promoted it and facilitated its largest known transaction, the news outlet stated. It remains unclear whether Zhao or Binance received any payment from World Liberty Financial for their work, it said.
Conflict of interest concerns
Critics have raised concerns over a potential conflict of interest for Trump, noting that Zhao, a convicted felon, stands to benefit from his pardon while his company supports a Trump-backed venture. The White House has maintained that Trump has no conflicts of interest, stating that his assets are in a trust controlled by his eldest son, Donald Trump Jr., and that he does not play a role in business decisions.
Trump’s crypto ambitions
Trump’s interest in cryptocurrency has evolved over time. Last year, he expressed hopes of making the United States the “crypto capital of the world.” Since then, his crypto ventures—including World Liberty and a memecoin announced days before his inauguration—have reportedly added millions of dollars to his fortune, according to the Bloomberg Billionaires Index.