Senate Demands Answers Over Trump's 'Pay-For-Pardon' Crypto Controversy

Senate Democrats have demanded a public accounting of President Donald Trump's pardon of Changpeng Zhao, the founder of cryptocurrency exchange Binance, calling the decision a corrupt favor to a "white-collar criminal" who funneled millions into Trump-linked ventures. In a Cointelegraph letter, seven senators—including Elizabeth Warren, Bernie Sanders, and Richard Blumenthal—urged Attorney General Pam Bondi and the Department of Justice to explain how the pardon could embolden crypto executives to "commit crimes with impunity, so long as they enrich President Trump enough." The move follows a Coinotag report revealing Binance spent over $740,000 lobbying Trump associates ahead of the pardon, including $450,000 to Checkmate Government Relations, a firm tied to Trump Jr., and $290,000 to Teresa Goody Guillén, a former SEC chair contender.

Zhao, known as CZ, had pleaded guilty in 2024 to violating U.S. anti-money laundering laws and served a four-month prison sentence. His pardon, announced October 22, came after Binance resumed aggressive lobbying efforts under the Trump administration, spending $860,000 in 2025 alone—building on prior expenditures exceeding $1 million in 2022, according to that report. The senators highlighted overlapping financial ties between Binance and Trump's crypto venture, World Liberty Financial (WLFI), including reports that Binance helped develop code for WLFI's USD1 stablecoin and facilitated a $2 billion investment from an Emirati firm, as outlined in a BeInCrypto report. Trump defended the pardon, claiming Zhao was "persecuted by the Biden administration" and that his actions "are not even a crime," a position described in a CryptoIntelligence report, but critics dismissed this as a justification for a "pay-for-pardon" system.

The political backlash has intensified amid broader scrutiny of Trump's crypto-friendly policies. Binance.US recently began trading WLFI's tokens, a decision framed by Democrats as evidence of regulatory capture in a Yahoo Finance story. Representative Maxine Waters, a leading critic, called the pardon a "massive favor for crypto criminals" and alleged it rewarded Binance for "funneling billions into Trump's personal crypto company," according to a Cointelegraph article. Meanwhile, Binance CEO Richard Teng has positioned the pardon as a win for the industry, stating Trump's administration is "strongly supporting crypto" and that the future "looks bright," remarks reported in a Bitcoinsistemi article.

Experts warn the case underscores vulnerabilities in the U.S. pardon process and the influence of financial power in Washington. "This sets a dangerous precedent," said one federal lobbying analyst, noting that crypto firms now face a 25% rise in lobbying expenditures in 2025 due to regulatory uncertainty, a detail highlighted in the Coinotag coverage. The senators' letter demands transparency on whether Trump's ties to Binance—including potential revenue from WLFI—affected his decision. As the crypto sector grapples with evolving regulations, the pardon has reignited debates over accountability, with lawmakers pushing for reforms to curb political influence in clemency decisions; those concerns were first reported in the Cointelegraph letter.