Discussions within the White House are intensifying regarding a potential pardon for Binance co-founder Changpeng “CZ” Zhao. Sources indicate that President Donald Trump is leaning toward granting clemency, amid internal debates about the strength of the case against Zhao and the political ramifications of such a decision.
Pressure is mounting as the administration weighs the implications of a pardon. According to Charles Gasparino, a journalist for Fox Business, “discussions inside the White House are heating up” concerning Zhao’s situation. Individuals close to Zhao assert that Trump’s advisers view the case against him as weak and not worthy of imprisonment. Some members of the administration believe Zhao’s prosecution was politically motivated and excessively punitive.
Yet, concerns persist regarding the public perception of pardoning a billionaire linked to the cryptocurrency industry, an area where Trump’s family has been increasingly active through various business ventures. Despite these concerns, sources suggest that Trump is inclined to authorize the pardon, which could enable Zhao to take a more prominent role in the cryptocurrency sector again. The administration remains cautious, however, about how the public might react to this decision.
Market Response and Background on Zhao’s Legal Issues
Following these reports, prediction markets such as Kalshi noted a more than 40% increase in the odds of a pardon for Zhao. This spike reflects growing confidence among traders that Trump may act favorably before the end of the year. In a podcast earlier this year, Zhao revealed that he had applied for a presidential pardon from Trump following his release from prison. The Wall Street Journal previously reported that while Zhao initially denied seeking clemency, he later confirmed this request.
Gasparino noted on Friday that a pardon from Trump could pave the way for Zhao’s return to the crypto exchange, given that he remains the largest shareholder of Binance. However, the administration continues to acknowledge the potential political consequences stemming from Trump’s deepening associations with digital assets.
Legal Context and Industry Implications
Zhao’s legal troubles began in 2023 when he pleaded guilty to failing to maintain an effective anti-money laundering program during his tenure as CEO of Binance. Consequently, he received a four-month prison sentence and was required to pay a fine of $50 million. Additionally, Binance agreed to a settlement of $4.3 billion, marking one of the largest corporate settlements in U.S. history. Although Zhao was released last year, he remains under a lifetime ban from managing Binance as part of his plea agreement. Current CEO Richard Teng confirmed in September that this lifetime restriction is still in effect, despite Zhao’s ownership stake.
A pardon from Trump could significantly reshape the cryptocurrency landscape in the U.S. It raises questions about whether it might enhance the global reputation of the crypto industry by allowing a high-profile leader to return or instead create a precedent that undermines accountability in the sector.
The White House has yet to issue an official statement on the matter, but reports indicate that officials are still deliberating the political and ethical considerations surrounding the potential pardon. In the political arena, Senator Elizabeth Warren and other Democratic leaders have called for increased accountability regarding the cryptocurrency policies made by the administration to prevent any conflicts of interest.
The discussions surrounding a possible pardon for Changpeng Zhao highlight the intricate intersection of law, politics, and the evolving cryptocurrency industry. As the situation develops, it remains to be seen how this decision will influence both Zhao’s future and the broader regulatory landscape in the United States.