Pardon or Political Favor? Binance's U.S. Return Divides Regulators

President Donald Trump's full pardon of Changpeng "CZ" Zhao, founder of cryptocurrency exchange Binance, has reignited speculation about the firm's potential return to the U.S. market, marking a stark policy shift for the administration. The move, announced on October 23, 2025, was reported by BBC Pidgin and absolves Zhao of a 2023 conviction for violating U.S. anti-money laundering laws, a development that MarketWatch says paves the way for Binance to resume operations in the country after a two-year ban. The White House framed the decision as an end to the "war on cryptocurrency" under the previous administration, with Press Secretary Karoline Leavitt asserting that Zhao's prosecution was politically motivated.

Binance, the world's largest crypto exchange by trading volume, had previously pleaded guilty to enabling users to bypass sanctions and paid a $4.3 billion penalty in 2023, according to CryptoRank. Zhao, who served a four-month prison sentence and a $50 million fine, was barred from leading the company during its U.S. exit. The Trump pardon now removes a major legal barrier, though the exchange must still navigate regulatory approvals from the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) to resume operations.

The decision reflects Trump's broader pro-crypto agenda, which includes appointing industry-friendly regulators and promoting the U.S. as a "crypto capital." The administration's shift contrasts sharply with the Biden era's aggressive enforcement actions against crypto firms. Binance's lobbying efforts, including hiring Trump-aligned consultants like Ches McDowell and former SEC contender Teresa Goody Guillén, are believed to have influenced the pardon, as detailed in a TradingView report.

The exchange also supported the Trump family's crypto venture, World Liberty Financial, through liquidity infrastructure and backend tools.

Critics, however, argue the pardon underscores ethical concerns about political influence. Mark Hays of Americans for Financial Reform called it a "dark picture of undue influence," while Rep. Maxine Waters condemned it as a "massive favor for crypto criminals". Binance's U.S. comeback faces skepticism due to its history of regulatory violations and the need to rebuild trust with state regulators, who require stringent compliance measures, a point emphasized by Live Bitcoin News.

Market reactions were mixed. Binance Coin (BNB) surged over 4% post-pardon, as Coinotag reported, reflecting investor optimism, but experts caution that regulatory hurdles remain. Analysts like Seoyoung Kim of Santa Clara University note that even if Binance regains U.S. access, competition with domestic exchanges like Coinbase and regulatory scrutiny could limit its impact.

The pardon has also reignited debates about the intersection of politics and crypto regulation. While Trump allies celebrate the move as a victory for innovation, detractors warn it risks eroding public trust in impartial oversight. Binance has not publicly commented on its next steps but has reportedly explored strategies to integrate its U.S. affiliate, Binance.US, into global operations.