Crypto exchange company Binance helped the Trump family’s own cryptocurrency venture make billions just before Donald Trump pardoned its co-founder, and the rejuvenated company now stands to reap its own windfall, a new report reveals.
Changpeng Zhao, who also goes by “CZ,” was pardoned by Trump last week after the administration said the businessman was “prosecuted by the Biden Administration in their war on cryptocurrency.”
Zhao pleaded guilty to enabling money laundering and agreed to step down as the CEO of Binance as part of a $4.3 billion settlement with the Justice Department in 2023. He served four months in prison.
Once Trump, who has touted himself as a crypto-friendly president, won the 2024 election, Zhao’s company reportedly saw an opening.
Binance created a “high-level task force to strike a deal” with the Trump-affiliated cryptocurrency venture World Liberty Financial, and launched a months-long bid for clemency, the Wall Street Journal reports, citing people familiar with the matter.
Members of the Trump family, through an umbrella company, own more than half of World Liberty.
World Liberty’s new stablecoin product — a cryptocurrency whose value is designed to maintain a one-to-one value with the U.S. dollar — saw the value of its shares jump from $127 million to over $2.1 billion this spring after Binance stepped in, according to the WSJ.
The technology that supports World Liberty’s stablecoin, USD1, was built by Binance and weeks after USD1 launched in March, an Emirati state-backed fund — MGX — used it to invest $2 billion in Zhao’s company, according to Bloomberg. The move by MGX reportedly provided World Liberty with the opportunity to net potentially tens of millions of dollars in interest.
World Liberty told the WSJ that Binance was not involved in the deal with MGX, while a lawyer for Binance said that Zhao “did not act as the relationship facilitator or financier” between MGX and the Trump family’s crypto venture.
Now that Trump has pardoned Zhao, the world’s largest trading crypto platform is likely to make a comeback in the U.S. following the 2023 ban.
World Liberty told the WSJ that a pardon was never discussed. The company’s lawyer, Tom Clare, said World Liberty “has never assisted in, facilitated, or influenced a decision on Mr. Zhao’s presidential pardon.”
The company said it supported Zhao’s pardon. “Everyone who has been a victim of Joe Biden’s lawfare has rightfully been pardoned,” World Liberty spokeswoman Gail Gitcho told the WSJ.
Wayne F. Dennison, a lawyer for Binance, said there was “no impropriety,” and the company “did not control the stablecoin chosen by MGX.”
Last week Trump said the pardon came “at the request of a lot of very good people,” but the optics of the decision concerned some within his administration, according to the WSJ.
White House press secretary Karoline Leavitt told the outlet that neither Trump “nor his family have ever engaged, or will ever engage, in conflicts of interest.”
Zhao was released from prison in September. Following Trump’s 2024 election win, Zhao and his Binance co-founder, Yi He, who is also his romantic partner, reportedly socialized with high-profile names, some within the the Trump circle.
In December, the couple hosted guests on a yacht in Abu Dhabi for the Grand Prix, including Elon Musk’s father, Errol Musk, and Bilal bin Saqib, a tech entrepreneur who later became an adviser at World Liberty, according to the WSJ.
While in Abu Dhabi, Zhao also reportedly socialized with Eric Trump and Steve Witkoff, now Trump’s special envoy, at a bitcoin conference, according to the outlet. World Liberty and a Trump administration official denied that the three met at the conference.
A few months later, in April, Zhao met with World Liberty’s Zack Witkoff — Steve Witkoff’s son — Saqib, the crypto entrepreneur, and other representatives linked to MGX, at a beachfront restaurant in St. Regis.
Zhao’s guilty plea was part of a multi-billion-dollar settlement with the Justice Department, which had been investigating Binance for violating the Bank Secrecy Act, failing to register as a money transmitting business and violating the International Emergency Economic Powers Act.
Federal prosecutors claimed Binance neglected to follow legal obligations, allowing terrorists, cybercriminals and child abusers to move money through its platform.
Zhao pleaded guilty to failing to maintain an effective anti-money laundering program, in violation of the Bank Secrecy Act, and resigned.
Democratic Sen. Elizabeth Warren blasted Trump’s decision to pardon Zhao.
“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,” Warren said in a statement. “If Congress does not stop this kind of corruption in pending market structure legislation, it owns this lawlessness.”
“Trump is selling pardons to anyone who can personally profit him. It’s a shameful abuse of power and a mockery of justice,” added Democratic Rep. Jerry Nadler of New York.
Even some of Trump’s supporters were vocal in their opposition to Zhao’s pardon.
Joe Lonsdale, the co-founder of software company Palantir Technologies, said Trump “has been terribly advised” in a post on X last week. “It makes it look like massive fraud is happening around him in this area,” Lonsdale, a Trump supporter, said.
Laura Loomer, a close confidante to the president, was critical of the move before it was announced last week.
“You know who gets Emirati citizenship when they weren’t born in the UAE? People who are trying to evade punishment for crimes,” Loomer said. Zhao responded that he no longer holds Chinese citizenship.
Binance representatives argued that under the Trump administration, Zhao’s actions would not have been prosecutable, according to the WSJ.
Ariana Baio contributed reporting