After President Donald Trump pardoned Binance founder Changpeng Zhao, it emerged that Zhao's corporations were technically involved in a cryptocurrency venture led by the Trump family. Even before the pardon, Binance had a partnership with World Liberty Financial, a cryptocurrency platform co-founded by the Trump family.
According to Bloomberg on the 4th (local time), Zhao in 2023 pleaded guilty to violating U.S. laws after Binance failed to properly implement anti-money laundering (AML) rules and stepped down as chief executive officer. He was sentenced to four months in prison and, after being released in September last year, received Trump's pardon. Zhao said on social media (SNS) X (formerly Twitter), "I am deeply grateful for the president's decision."
The link between Binance and World Liberty Financial is the stablecoin "USD1." Binance wrote the base code for USD1, which is designed to be pegged 1:1 to the value of the U.S. dollar. Shortly after launch, United Arab Emirates sovereign fund MGX invested $2 billion in Binance, strengthening the initial capital base for the stablecoin. With MGX's choice, World Liberty Financial secured the potential to earn tens of millions of dollars in interest revenue from the stablecoin reserves.
World Liberty Financial is a platform co-founded by the Trump presidential family and real estate developer Steve Witkoff's family, with the Trump side holding 38% of the parent company's equity. According to Bloomberg, the Trump family earned more than $500 million (675 billion won) from the venture and, by holding 22.5 billion of its own tokens, was estimated to have a valuation worth hundreds of millions of dollars.
Ethics watchdogs and Democratic lawmakers criticized that the president's family directly engaging in a cryptocurrency business could cause policy decisions to conflict with private interests. The Trump family denied the allegations, and the White House countered, "President Trump is the most transparent president in history in every respect, including finances."
Trump, who once criticized Bitcoin as "it looks like a scam," has returned in his second term as the industry's biggest champion. He pardoned Ross Ulbricht, founder of the Bitcoin-based illegal marketplace "Silk Road," followed by Arthur Hayes, BitMEX co-founder. He then pardoned Zhao as well, continuing a close alignment with the industry.
Binance has maintained enormous global influence even after Zhao's departure. It paid more than $4 billion in fines for AML violations, yet still holds its position as the world's largest cryptocurrency exchange by trading volume. Zhao, in exchange for a guilty plea that reduced his sentence, lost management control but is still believed to hold a significant portion of Binance equity.
In political and financial circles, suspicions have been raised that Trump's pardon decision was entangled with personal interests. Since Binance, led by Zhao, provided technical support to the Trump family's cryptocurrency venture, and soon after Trump pardoned Zhao, critics said an "inherent conflict of interest" was inevitable. In a CBS "60 Minutes" interview, President Trump explained, "I don't know who he is," but the circumstances linking the pardon to economic interests remained contentious.
Meanwhile, the cooperation between Binance and World Liberty is cited as a symbolic case of the fading boundary between political power and the digital asset market. Jason Blikman, a digital governance researcher at the Carnegie Endowment for International Peace, warned, "The fusion of an administration and the cryptocurrency industry may be a boon for the market in the short term, but in the long term it carries potential risks that could undermine public trust."