Binance Pardon Could Undermine Crypto Oversight, Lawmakers Warn

President Donald Trump is reportedly considering a pardon for Changpeng Zhao, the founder and former CEO of Binance, according to multiple sources. White House discussions have intensified over the potential move, with insiders suggesting the case against Zhao-convicted in 2024 for violating U.S. anti-money laundering laws-was "weak" and politically motivated Cryptobriefing^[1]. Zhao, known as CZ in the crypto community, remains Binance's largest shareholder and could return to the company if pardoned, despite ongoing compliance monitoring under a 2023 settlement that imposed a $4.3 billion fine on the exchange Cryptonews^[5].

Market sentiment reflects growing speculation about a pardon. On Polymarket, the implied probability of Trump granting Zhao a pardon surged to 36% in late September 2025, surpassing other high-profile candidates like former U.S. Rep. George Santos and Bitcoin advocate Roger Ver Cryptonews^[8]. Earlier in the year, odds fluctuated between 20% and 64%, driven by news of Zhao's legal team submitting a pardon request in April 2025 and his public hints at seeking clemency 99Bitcoins^[3]. However, the U.S. Department of Justice's official pardon database shows no record of a finalized decision as of June 2025 Cryptopolitan^[4].

Political tensions surround the potential pardon. Democratic lawmakers, including Sen. Elizabeth Warren, have raised concerns about conflicts of interest, citing Binance's $2 billion stablecoin deal with World Liberty Financial-a Trump-linked firm-and Zhao's financial ties to the Trump family Cointribune^[9]. These connections have sparked calls for transparency, with critics warning that the move could undermine regulatory oversight of the crypto sector.

Zhao himself has denied recent rumors of a pardon, calling them "planted" by a Chinese media outlet and emphasizing that no formal decision has been made Cryptopolitan^[4]. He reiterated his request for clemency in a May 2025 podcast, framing it as a step toward restoring trust in Binance's compliance efforts. Meanwhile, Binance's current CEO, Richard Teng, has not commented on the possibility of Zhao's return.

The outcome remains politically charged. Trump has previously pardoned crypto figures, including Silk Road founder Ross Ulbricht and BitMEX co-founders, positioning himself as a crypto-friendly leader. If granted, a pardon could bolster Binance's reputation but also invite scrutiny over regulatory leniency. Conversely, a denial would reinforce the Biden administration's hardline stance on compliance The Cryptonomist^[7].