Author: Seedly.eth

The founder of Binance, Changpeng Zhao (CZ), who once led the world's largest cryptocurrency exchange, admitted at the end of 2023 to violating the U.S. Bank Secrecy Act and was sentenced to four months in prison for failing to establish an effective anti-money laundering program. After being released from prison in 2024, just a year later, he experienced a turning point in his fate—U.S. President Trump issued a pardon that restored his complete freedom.

For many observers, this pardon was a "shoe dropping"; however, its signing may signify that a more complex aftermath is just beginning.

The Trump administration declared that the "war on cryptocurrency is over" and described the previous Biden administration's prosecution of CZ as political persecution.

At the same time, a complex web of interests emerged, revealing the Trump family's deep involvement in the cryptocurrency industry—on one hand, CZ-led Binance faced setbacks in the U.S., while on the other, Trump and his children were building a vast empire in the cryptocurrency space.

All of this intertwines into a shocking reality show between Washington and Wall Street: money, power, digital currency, and the interest transactions at the core of American power.

CZ's Conviction: From Investigation and Settlement to Four-Month Sentence

CZ was once one of the most legendary figures in the crypto world, but he experienced a rapid downfall under the iron fist of U.S. regulation.

The U.S. Department of Justice had been investigating Binance for years over alleged anti-money laundering and sanctions violations, accusing it of allowing the platform to be used for suspicious transactions, including transfers involving the terrorist organization Hamas. Under immense legal pressure, CZ reached a plea agreement with the U.S. Department of Justice on November 21, 2023, admitting to failing to establish effective anti-money laundering compliance procedures at Binance, thus violating the U.S. Bank Secrecy Act (BSA).

As part of the agreement, Binance also acknowledged the related violations, and both parties agreed to pay a total of over $4 billion in fines to settle the case—of which Binance paid approximately $4.3 billion, and CZ personally paid a $50 million fine. This fine made it one of the largest corporate settlements in U.S. history.

The settlement agreement also imposed severe restrictions on Binance and CZ himself: CZ announced his resignation as CEO of Binance, with former Asia-Pacific head Richard Teng taking over, and he agreed to a lifetime industry ban, permanently barred from managing or operating Binance's global business, especially from holding any executive position at Binance U.S.

Binance was required to undergo three years of independent compliance monitoring to ensure its operations met legal requirements. Notably, CZ became the first person in U.S. history to be imprisoned solely for a single BSA charge. At the sentencing hearing on April 30, 2024, a federal judge in Seattle ultimately sentenced CZ to four months in prison.

This sentence, while seemingly short, held symbolic significance—it demonstrated the regulatory authorities' determination to hold crypto giants accountable, causing widespread anxiety in the global crypto industry.

During his imprisonment, CZ was held in a U.S. federal prison. He was released in September 2024, ending his four-month incarceration.

At this point, CZ no longer held any position at Binance, which was also prohibited from conducting business in the U.S. due to its guilty plea and regulatory issues. The once-mighty crypto billionaire suddenly fell from grace, suffering significant damage to his personal reputation and business empire.

CZ After Prison: Silence or Underlying Currents?

After his release, CZ initially chose to keep a low profile, staying away from the public eye.

However, beneath the surface of this silence, social media and industry rumors indicated that he had not completely exited the crypto stage. In early 2025, rumors began to circulate about a possible pardon for CZ from the Trump administration, spreading on social media platforms like Twitter (now known as X).

In response, CZ actively addressed media reports and participated in public discussions, demonstrating that his influence had not completely waned due to his imprisonment.

In March 2025, The Wall Street Journal suddenly broke the news: representatives of the Trump family had been in close discussions with Binance since 2024 about a potential acquisition of a stake in Binance U.S., while also revealing that CZ was seeking a presidential pardon. This report sent shockwaves through the industry and thrust CZ back into the spotlight.

That day, CZ quickly took to X to refute the claims: "I'm sorry to disappoint everyone, but The Wall Street Journal got the facts wrong. The truth is: I have not discussed… any acquisition of Binance U.S. with anyone." However, he then shifted his tone, admitting, "No felon would mind receiving a pardon, especially since I am the only person in U.S. history to be imprisoned for a single BSA charge." This statement was seen as an implicit acknowledgment of his desire for a pardon. CZ further suggested that the report had political motives, stating that it felt like an "attack on President Trump and cryptocurrency," and that "the remnants of the Biden administration's war on cryptocurrency are still at work."

By early May 2025, CZ began to more openly express his desire for a pardon.

On May 7, he confirmed for the first time during a podcast that he had formally submitted a presidential pardon application to the Trump administration. CZ explained that the reason for submitting the application was that since mainstream media was reporting on the matter, "it would be better to formally make the request." He revealed that the application was submitted between late March and early April, completed within two weeks after the related reports were published.

During this period, observant followers also noticed that CZ had quietly removed the phrase "former @Binance CEO" from his social media profile—this move was seen as a hint at a potential change in his future identity and sparked speculation about his "comeback."

In August 2025, U.S. media further disclosed CZ's efforts to obtain a pardon: on August 13, he hired a lobbyist, Ches McDowell, who had close ties to Trump’s son Donald Trump Jr., to lobby for the pardon in Washington. This news confirmed suspicions that CZ was actively working behind the scenes.

Meanwhile, the crypto community's attention to CZ's fate reached a peak: bets on the decentralized prediction market Polymarket regarding "Will CZ receive a pardon?" surged, with the probability of a successful bet soaring to 64% in mid-October. Even some in the crypto circle created memes like "Binance Life," joking that if CZ were freed, he would continue his inseparable journey with Binance.

Trump's Sudden Pardon: White House Intervention and Political Storm

On October 22, 2025, President Trump signed a pardon for CZ at the White House and announced the decision to the public the next day. White House Press Secretary Caroline Levitt stated in a release: "The President exercised his constitutional power to pardon Mr. CZ, who was prosecuted in the Biden administration's war on cryptocurrency. The war on cryptocurrency by the Biden administration is over."

This move by the Trump administration effectively declared the formal end of the previous administration's high-pressure regulation of the crypto industry and openly vindicated CZ. Trump reportedly held a sympathetic view towards claims of persecution against CZ and other industry figures, with several sources close to Trump stating that he believed the case against CZ was "quite weak and should never have escalated to felony charges and imprisonment."

The news of the pardon immediately triggered intense political reactions in Washington. Supporters viewed it as a reflection of Trump's commitment to embrace innovation and correct the mistakes of the previous administration, while critics condemned it as a blatant exchange of interests that severely undermined the rule of law and moral standards. Democratic lawmakers, particularly those in the opposition, were especially outraged. Senior members of the Senate Banking Committee, including Elizabeth Warren, quickly issued a joint statement after the pardon announcement, directly accusing the Trump administration of condoning crypto crime and weakening financial regulation. Warren had warned back in May, when the Trump family's crypto enterprise was involved in a massive transaction with Binance, stating: "A foreign government-backed fund announced it would use Trump's stablecoin to complete a $2 billion deal, while the Senate was preparing to pass the so-called 'GENIUS Act'—this stablecoin legislation would make it easier for the President and his family to line their pockets. This is corruption, and no senator should support it." In her view, Trump's pardon of CZ implied significant interests and conflicts.

The Republican camp largely welcomed the move, viewing the Biden administration's handling of CZ as an example of over-enforcement.

Trump administration officials and supporters emphasized that CZ's charges would typically not result in imprisonment for other financial executives, asserting that the Biden administration had "chosen to enforce" due to political animosity towards the crypto industry, while Trump merely corrected this injustice in a timely manner. The new Treasury Secretary under Trump even stated in an interview: "The war on the crypto industry has come to an end, and the U.S. will strive to become the global crypto capital." The market reacted swiftly: after the pardon announcement, the price of Binance's BNB token surged, rising from 1083 USDT to 1160 USDT within just a few hours, an increase of 6.7%.

It can be said that this pardon stirred a storm in the political arena and public opinion, also creating ripples in the capital market.

From a legal standpoint, the presidential pardon means that CZ's federal charges will be dismissed, and the associated penalties may also be wiped away. Legal experts point out that the president possesses the highest pardon power granted by the U.S. Constitution, allowing for the pardon of federal convictions and sentences. Therefore, Trump's pardon not only shields CZ from further legal consequences but may also lift several restrictions he committed to in the plea agreement with the Department of Justice. This means that CZ theoretically has the opportunity to regain control of the cryptocurrency empire he built—an idea that excites his supporters but deeply concerns regulatory hardliners.

The Trump Family's Crypto Empire: NFTs, Tokens, and Hidden Interest Networks

Behind the ups and downs of the CZ case, the rapid rise of Trump and his family in the cryptocurrency sector serves as a continuous undercurrent.

Although Trump publicly stated in 2019 that he was "not interested" in Bitcoin, he transformed into an active participant in the crypto space in the years following his departure from the White House. Especially during his 2024 campaign, Trump changed his stance and embraced digital currencies: he not only declared that the U.S. government would never sell its Bitcoin and would classify Bitcoin as a strategic reserve asset but also announced on his official website that he would accept cryptocurrency donations to support his campaign. More importantly, the Trump family began to commercialize the "Trump" brand, deeply embedding it into a series of NFT and cryptocurrency projects, thus constructing a cross-political and business crypto empire.

First, in the NFT space. In December 2022, Trump launched his first personal NFT series—"Trump Digital Trading Cards," each priced at $99.

These NFT cards featured exaggerated images of Trump as a superhero, astronaut, cowboy, and more, and they sold out within 18 hours, generating sales of $4.455 million. After tasting success, Trump subsequently released four more NFT series, selling over 200,000 digital collectible cards in total, with direct sales revenue exceeding $22 million; combined with royalties from secondary market transactions, it is conservatively estimated that his NFT project has brought Trump over $8 million in net profit. Trump successfully transformed his personal IP into a hot-selling item on the blockchain, not only filling his pockets but also cultivating a large community of crypto supporters.

However, compared to NFTs, the Trump family's involvement in tokens and crypto finance has a more profound impact. In September 2024, Trump's two sons, Donald Trump Jr. and Eric Trump, announced their entry into the digital asset market by founding a crypto company called "World Liberty Financial" (WLF). In October, the company launched its first cryptocurrency—WLFI token, claiming that this token would be endorsed by the Trump family, granting holders "shareholder-like" rights to participate in company decisions. Although the initial response to the issuance was lukewarm, by the end of October 2024, only $2.7 million worth of WLFI had been sold.

But fortunes changed: after Trump won the presidential election in November 2024, demand for WLFI surged. Riding the wave of Trump's victory, WLF attracted several large investments and token subscriptions in early 2025. Data shows that WLF has conducted eight rounds of private fundraising, raising at least $590 million, with the off-exchange trading of WLFI tokens estimating its fully diluted market cap to have reached approximately $123 billion at one point.

One key reason for WLF's skyrocketing valuation is its establishment of a secret channel between the White House and the crypto world: Trump's current presidential status provides this family business with unparalleled "policy endorsement." According to disclosures from WLF and media investigations, Trump personally holds 60% of WLF through a family trust and enjoys 75% of the company's token sales revenue.

Trump's two sons are directly involved in managing operations, serving as so-called "Web3 ambassadors," and jointly steering daily business with several seasoned crypto entrepreneurs. Even more astonishingly, WLF has secured family interests by reserving a massive amount of tokens: the Trump family and its affiliates were directly allocated 22.5 billion WLFI tokens (22.5% of the total supply). In less than a year, The New Yorker estimated that the Trump family had profited approximately $412.5 million from this project. It can be said that the Trump family has effectively transformed the political influence of the White House's "First Family" into the highly sought-after "first capital" in the crypto space.

In addition to issuing the WLFI token, WLF also launched a dollar-pegged stablecoin, USD1, in March 2025, claiming it was 100% backed by U.S. Treasury bonds and cash assets.

Just over a month after Trump returned to the White House, this stablecoin made headlines in a significant international transaction: the sovereign investment firm MGX, led by Abu Dhabi's National Security Advisor Tahnoun bin Zayed, announced it would use $2 billion worth of USD1 to acquire a stake in Binance! WLF co-founder Zach Witkoff excitedly announced this news at a Dubai crypto conference, stating, "USD1 has been selected as the official stablecoin for MGX's $2 billion investment in Binance."

Notably, Zach is the son of Trump's Middle East envoy and old friend, Steve Witkoff. Present alongside Zach at the event were Trump's second son, Eric Trump, and Asian crypto tycoon, Tron founder Justin Sun.

The exposure of the MGX transaction sparked intense scrutiny in U.S. politics: on one hand, a foreign government-backed UAE sovereign fund was injecting massive capital into Binance through a stablecoin issued by the Trump family business, while on the other hand, the Trump administration almost simultaneously approved the export of cutting-edge chip equipment worth hundreds of millions of dollars to a company controlled by Tahnoun, despite national security agencies' concerns that these chips could end up in China.

Such coincidences raised questions from the media and oversight bodies—was the Trump administration exchanging national interests for family business benefits? A deep investigation by The New York Times stated that WLF's operations "blurred the lines between private enterprise and government policy, unprecedented in modern American history." The report revealed that WLF had secretly accepted large sums from foreign investors and digital currency exchanges in exchange for access to Trump, noting that at least one investigation into related individuals was dropped after payments were completed. For instance, Chinese crypto tycoon Justin Sun invested at least $75 million in WLF and served as an advisor in early 2025, after which the U.S. Securities and Exchange Commission (SEC) suspended its investigation into Sun's companies. Such connections of interest cast a thick shadow of conflict over the Trump family's crypto empire.

Another intriguing chapter in the Trump family's crypto journey is Trump's personal meme coin. Just before his second term inauguration, Trump's team unexpectedly launched a meme token called $TRUMP on January 17, 2025. This token was issued on the Solana blockchain, with a total supply of 1 billion tokens, 20% of which were publicly sold through an ICO, while the remaining 80% were held by companies owned by the Trump family. Within less than a day of its issuance, the market cap of $TRUMP skyrocketed to $27 billion, making the value of the tokens held by Trump exceed $20 billion.

Although this inflated valuation is unsustainable, according to the Financial Times, the project still brought Trump at least $350 million in real profits within a few months. More concerning is that after returning to the White House, Trump publicly touted the value of the $TRUMP token multiple times and took executive actions to boost its price, directly leading to a significant increase in his personal net worth. Ethicists condemned this, stating that Trump, as president, promoting a private crypto project and manipulating policies to benefit his own token constitutes an unprecedented conflict of interest. However, Trump's spokesperson argued that the president's business assets are managed by his children, thus "there is no conflict of interest."

Pardon Controversy: Vote Trading or Money Exchange?

Taken together, various signs indicate that Trump's pardon of CZ was not merely based on policy ideology but likely involved calculations of vote trading and interest exchange. In the 2024 election, cryptocurrency industry practitioners and investors were seen as an emerging political force that could not be ignored. The Biden administration's harsh regulation of the crypto market angered many in the crypto community, and Trump keenly captured this public sentiment, positioning himself as the "crypto president," promising to liberate crypto productivity once in office. Reports indicate that Trump's campaign not only received donations from some crypto whales and institutions but also conveyed goodwill to the crypto community through high-profile involvement in NFTs and tokens.

In the first month of his return to the White House, he signed several executive orders favorable to the crypto industry, such as promoting the "GENIUS Act" to ease stablecoin regulation in Congress and inviting well-known crypto entrepreneurs like the Winklevoss twins to the White House for an event themed "American Crypto Renaissance." Against this backdrop, pardoning CZ undoubtedly further solidified Trump's reputation and voter base within the crypto community. CZ has a large fan base and customer base globally, and Trump's pardon of him is seen as a friendly signal to the entire crypto community, aimed at courting this emerging voter group.

On the other hand, it is important to note the potential interests of Trump's overseas financiers in the CZ case. As a global trading platform, Binance has countless connections with international capital, including the previously mentioned Abu Dhabi MGX fund and overseas investors like Justin Sun.

These individuals are not only important partners in CZ's business empire but also esteemed guests of Trump's crypto enterprises. From MGX investing in Binance using Trump's stablecoin to the Trump administration exporting high-tech chips to the UAE, and Justin Sun investing in Trump's company in exchange for leniency from the SEC, the implications of mutual benefit throughout this chain are glaringly obvious. Trump's pardon of CZ is likely a key link in this transnational interest game: once CZ regains his freedom, his influence and resources will flow back into the market, indirectly benefiting the overseas capital allied with the Trump family. Some speculate that it was these behind-the-scenes stakeholders who actively lobbied or even pressured Trump to ultimately decide to pardon CZ.

Currently, there is no direct evidence proving that Trump received money in exchange for the pardon, but numerous details have raised public vigilance. The House Minority Leader has called for an investigation into Trump's decision to pardon CZ, examining whether there are any abuses of power or exchanges of interests involved. Government ethics oversight organizations have also voiced their demands for transparency regarding the Trump family's crypto investments and decision-making processes, to clarify whether the president's actions are influenced by private business interests. It can be said that the CZ pardon incident has transcended the judicial realm, escalating into a question of political integrity and the rule of law in the United States.

Regulatory Impact and Global Landscape: Where is the Crypto Industry Headed?

The aftermath of the CZ case and Trump's pardon is profoundly influencing the regulatory direction and market landscape of the cryptocurrency industry in the United States and globally. Domestically, Trump's ascension marks a 180-degree turn in federal government policy towards cryptocurrencies: agencies like the Securities and Exchange Commission (SEC) have slowed down or even withdrawn lawsuits against crypto companies. For instance, the SEC had filed a civil lawsuit against Binance in 2023, but shortly after Trump took office, the case was dismissed. Most regulatory officials have been replaced with those who hold a more open attitude towards crypto, with "safe harbor" and "exemption" becoming key terms. This has relieved U.S. crypto companies that had previously been anxiously seeking compliance. Forbes reported that by 2025, several crypto exchanges (such as Gemini, founded by the Winklevoss twins, and Bullish) successfully went public, joining Coinbase. Bitcoin prices reached new highs in 2025, briefly surpassing $126,000, with market participants declaring, "The winter is over, and the bull market has resumed." It can be said that the Trump administration's arrival and a series of friendly measures have led to a long-awaited revival in the U.S. crypto industry.

However, this sudden change in the regulatory environment has also triggered complex shifts in compliance trends.

On one hand, the relaxation of regulations in the U.S. has released dividends, attracting capital and projects back, with crypto entrepreneurship and investment activities heating up dramatically. Statistics show that in the third quarter of 2025, the global M&A transaction volume in the crypto sector exceeded $10 billion, a staggering 30-fold increase year-on-year. Many traditional Wall Street giants (such as JPMorgan and BlackRock) have seized the opportunity to enter the crypto market, launching regulated Bitcoin funds, spot ETFs, and other products. The easing of regulatory barriers and policy endorsements have made these financial institutions willing to deeply engage in the crypto space. This has further stimulated industry consolidation, with asset management companies like 21Shares being acquired, and crypto-native companies initiating a wave of acquisitions to solidify their competitive advantages. Overall, under Trump's leadership, the U.S. is striving to create a "global crypto capital," attempting to gather compliant funds and technologies domestically to take the lead in the next round of innovation.

On the other hand, the sudden leniency of U.S. regulations has raised concerns about risk control and regulatory arbitrage.

Some countries in Europe and Asia have chosen to remain cautious, even reinforcing regulatory fences to guard against the speculative risks brought about by the U.S. policy shift. For example, the EU's MiCA regulatory framework launched in 2024 continues to be strictly enforced, with no leniency on capital requirements for stablecoin issuers and operational norms for exchanges. In contrast, the U.S. has significantly weakened its enforcement against large crypto companies, allowing even someone like CZ, who was convicted for anti-money laundering issues, to be swiftly pardoned. Critics have described this as "rolling back history." Financial crime experts warn that the U.S.'s softened stance may foster a sense of complacency in the industry, with some companies relaxing internal compliance because they see that even crossing the line may allow them to escape sanctions or even overturn decisions through political means. This poses a potential threat to the global anti-money laundering and counter-terrorism financing system, as other jurisdictions may have to "go their own way" in crypto regulation, making global regulatory coordination more challenging.

For international platforms like Binance, the shift in U.S. policy is undoubtedly a significant turning point. Although Binance suffered a setback and exited the U.S. market in 2023, the pardon from Trump and the regulatory easing may provide an opportunity for a comeback. Analysts point out that Binance's U.S. operations were originally paralyzed, but now they may welcome investment from the Trump family, achieving a "curve rescue." More notably, CZ's personal space for action has significantly expanded. If he truly intends to return to a leadership position in the industry, Trump's pardon has cleared the main legal obstacles. Of course, this depends on the subtle relationship between CZ and U.S. regulatory authorities in the future: during the Trump administration, he may have a smooth path, but if the regime changes again, he and Binance may still face liquidation risks. This uncertainty also reflects the political concerns surrounding U.S. crypto regulation—where the rise and fall of companies are highly correlated with changes in the White House, which is detrimental to long-term industry stability.

In the international market landscape, the CZ case and Trump's pardon have also triggered a chain reaction. Funds from Asia and the Middle East are actively seizing this opportunity, accelerating their layout in the global crypto landscape. Institutional investors in places like Abu Dhabi, Singapore, and Hong Kong, who previously kept their distance from Binance for fear of crossing U.S. red lines, may now be emboldened to cooperate with it due to Trump's change in attitude.

Binance itself may also seek a new balance between compliance and gray areas: since the U.S. market has shown signs of recovery, Binance will inevitably invest resources to rebuild its compliance image and repair its relationship with U.S. regulators while solidifying its dominant position in non-U.S. markets. As U.S.-based exchanges like Coinbase and Gemini expand overseas due to favorable policies, if Binance can regain some level of access to the U.S. market, it will undoubtedly solidify its position as a global leader.

Conclusion

CZ's story seems to have reached a conclusion, but the discussions it has sparked are far from over.

After this incident, everyone sees more clearly. The regulatory logic in the U.S. is not monolithic; it can shift in power struggles and adjust under industry pressures. The crypto world is no longer an isolated island that can completely detach itself; it must learn to survive in the gaps of policy and even actively participate in rule-making.

Trump's pardon is less of an endpoint and more of a new beginning. It has shown the market the immense influence of politics on the crypto industry and made regulatory agencies in various countries realize that dealing with this emerging field may require more flexible strategies than previously imagined.

CZ has regained his freedom, but the long process of integration between the crypto world and mainstream society is far from over. The only certainty is that every technological breakthrough and policy adjustment in the future will continue to test the wisdom of all parties involved. Where this path will lead, no one can predict in advance.

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