Trump's CZ Pardon Sparks Crypto-Politics Clash

Trump administration discussions are intensifying over a potential presidential pardon for Changpeng "CZ" Zhao, the former CEO of Binance, according to multiple reports. Financial journalist Charles Gasparino cited internal conversations suggesting Trump is "leaning toward a pardon," though advisers have raised concerns about the optics, given the president's family's growing involvement in crypto ventures Charles Gasparino^[1]. Zhao, who served a four-month prison sentence in 2024 as part of a $4.3 billion settlement with U.S. authorities, has applied for clemency, a move that has already driven the odds of a pardon to over 64% on prediction markets like Polymarket Polymarket^[2].

Zhao's legal troubles stem from his 2023 guilty plea to violating the Bank Secrecy Act by failing to maintain an effective anti-money laundering program. As part of the settlement, Binance agreed to pay $4.3 billion in penalties, while Zhao personally paid $50 million and was barred from holding executive roles at the exchange. Despite being released in mid-2024, Zhao remains the largest shareholder in Binance BeInCrypto^[3]. A pardon would erase his felony conviction, restore his business rights in the U.S., and potentially allow him to re-engage with the crypto industry, though regulatory restrictions tied to his 2023 plea deal would still limit his operational role at Binance Cryptobriefing.com^[4].

The timing of the pardon consideration aligns with broader shifts in U.S. crypto policy under the Trump administration. The Department of Justice (DOJ) recently disbanded its National Cryptocurrency Enforcement Team, shifting focus to prosecuting crimes like terrorism, fraud, and drug trafficking while scaling back enforcement against crypto exchanges and compliance violations CNBC^[5]. This regulatory retreat has coincided with the administration's pro-crypto agenda, including the launch of Trump-branded NFT projects and the appointment of crypto-friendly officials to key agencies.

Market reactions to the pardon speculation have been swift. Binance's native token, BNB, hit an all-time high of $1,083 in September 2025, driven by renewed optimism about regulatory clarity and Zhao's potential return Detroit News^[6]. Traders on prediction markets have also priced in a 50% chance of a pardon occurring before January 20, 2026, a jump from earlier levels. Analysts suggest the move could signal a more lenient approach to crypto regulation, potentially boosting industry confidence but also reigniting debates over preferential treatment for high-profile figures compared to smaller players targeted by regulators Tecronet.com^[7].

Political motivations are also at play. With the 2026 elections approaching, a pardon could position Trump as a champion of innovation and attract crypto voters, a demographic that has grown increasingly influential. Critics, however, warn of conflicts of interest, noting Trump's family's financial ties to Binance through World Liberty Financial, a crypto venture that has already raised $550 million in tokens Cryptonews.com^[8].

For Binance, a pardon could have mixed implications. While it might restore Zhao's credibility and open new partnership opportunities, his reinstatement as a leader at Binance would likely face renewed scrutiny from U.S. regulators and global partners. The exchange, which operates under strict compliance monitoring as part of its 2023 settlement, is also reportedly negotiating with the DOJ to drop its external compliance monitor, a move that could further ease regulatory burdens Bloomberg^[9].

The potential pardon underscores the deepening intersection of crypto and politics. As one trader noted on social media, "If Trump pardons CZ, that's the ultimate bull signal for the industry," reflecting the sector's view of the White House as a critical arbiter of its future X Post by Charles Gasparino^[10]. However, the decision's outcome will depend not only on legal merits but also on the complex political calculus within Trump's inner circle.

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