Binance Founder CZ Denies WSJ Report of Testimony Against Justin Sun in DOJ Deal

TLDR

• Former Binance CEO Changpeng “CZ” Zhao denies claims he agreed to testify against TRON founder Justin Sun in his DOJ plea deal
• Zhao served 4 months in prison for Anti-Money Laundering violations, becoming the wealthiest person to ever serve time in a US jail
• Justin Sun called CZ his “mentor and close friend,” expressing full trust in both CZ and the DOJ
• The Wall Street Journal reported CZ provided evidence against Sun as part of his plea agreement, citing unnamed sources
• Sun’s legal case with the SEC was paused after he invested $75 million in Trump-backed DeFi project World Liberty Financial

Former Binance CEO Changpeng “CZ” Zhao has firmly denied claims that he agreed to testify against TRON founder Justin Sun as part of his plea deal with the US Department of Justice. The denial comes in response to an April 11 Wall Street Journal report that alleged Zhao provided evidence against Sun to prosecutors.

In a post on social media platform X, CZ dismissed the WSJ report, writing: “WSJ is really TRYING here. They seem to have forgotten who went to prison and who didn’t.” He argued that if he were indeed a government witness, he wouldn’t have served jail time.

CZ further claimed someone may have paid WSJ employees to run a “smear campaign” against him. He provided no evidence to support this allegation.

Multiple people have told me again WSJ is writing another baseless hit piece about me. 4 😂

— CZ 🔶 BNB (@cz_binance) April 11, 2025

The Prison Sentence

Zhao was sentenced to four months in prison in April 2024 after pleading guilty to Anti-Money Laundering violations while serving as Binance CEO. He was released from US federal prison in September 2024, making him the wealthiest person to ever serve time in a US jail, with an estimated net worth of $60 billion.

In clarifying the charges against him, CZ emphasized to BlockTower Capital founder Ari Paul: “To be clear, there were NO ‘money laundering’ or ‘fraud’ charges. You are confusing ‘ANTI-money laundering’ to ‘money laundering’. One is a failure to prevent/police. One is doing it yourself.”

The WSJ report claimed that as part of Zhao’s plea deal, he agreed to provide evidence on Sun to prosecutors. The report cited unnamed sources and stated “that arrangement hasn’t previously been reported.”

Sun’s Response

Justin Sun also responded to the allegations on social media, appearing to downplay the WSJ report. “I’m not aware of the circulating rumors. CZ is both my mentor and a close friend—he has played a crucial role in supporting me during my entrepreneurial journey,” the TRON founder wrote on X.

Sun emphasized his direct communication with both CZ and the US Department of Justice. He highlighted that the DOJ is one of the “closest and most trusted partners” of T3 Financial Crime Unit (T3 FCU), a blockchain security initiative co-founded by TRON, Tether, and TRM Labs.

They always try to use rumors to drive us apart, to divide us instead of unite us. Crypto is already a small space—only by standing together can we change everything! We need every single one of your votes!

— H.E. Justin Sun 🍌 (@justinsuntron) April 12, 2025

“To this day, his conduct and principles remain the highest standard I strive to follow as a founder,” Sun said of Zhao. “Whether it’s CZ or our partners at the DOJ, we maintain direct, honest communication at all times. I have full trust in each and every one of them.”

Legal Developments

Sun’s own legal situation has seen recent developments. On February 26, the US Securities and Exchange Commission and Sun asked a federal court to pause the regulator’s case against the crypto entrepreneur to allow for settlement talks.

The pause in Sun’s legal battle with the SEC came shortly after he invested $75 million in World Liberty Financial, a Trump-backed DeFi project. This investment made Sun the project’s largest single investor and earned him an advisory role.

The timing of the legal case pause following Sun’s large investment in the Trump-backed crypto project has raised concerns. Two senior Democrats have written to the SEC seeking all records related to World Liberty Financial, with a particular focus on its dealings with Sun.

In March 2023, the SEC had sued Sun and three of his companies: the entity behind Tron, the Tron Foundation, and the file-sharing platform backers the BitTorrent Foundation and its San Francisco-based parent firm, Rainberry Inc.

CZ had known about the WSJ report before its publication, as he indicated on April 11 in a post on X that the “WSJ is writing another baseless hit piece.” This suggests he was aware of the allegations before they were made public.

Since his release from prison, Zhao has been involved in various endeavors both within and outside the cryptocurrency industry. The exact nature of these activities was not detailed in the available information.

The controversy comes at a time when regulatory scrutiny of the cryptocurrency industry continues to evolve, with major players like Binance and figureheads like CZ and Sun often at the center of legal and regulatory developments.