Senator Warren Criticizes Trump’s Pardon of Binance’s Founder Amid Support from Crypto Advocates

Warren

Senator Elizabeth Warren has expressed strong disapproval of President Donald Trump’s decision to pardon Changpeng Zhao, the founder of Binance. She deems it a case of political corruption requiring congressional action. On the other hand, Zhao, known as CZ, has garnered support from the crypto community despite ongoing controversies surrounding his legal troubles and ties to the Trump administration.

Key Takeaways

Senator Elizabeth Warren criticized President Trump’s pardon of Binance founder Changpeng Zhao, labeling it political corruption.
Reports suggest Zhao sought ties with Trump, assisting with initiatives related to the former president’s crypto projects.
Critics have defended Zhao, asserting he pleaded guilty to insufficient anti-money laundering controls, not direct money laundering.
Following his pardon, Zhao expressed gratitude and commitment to enhancing America's status in the crypto world.
The pardon has sparked a divide in political opinions on regulatory approaches to digital assets.

Warren Slams Trump’s Decision

Senator Elizabeth Warren voiced strong criticism on Thursday regarding President Donald Trump’s decision to grant a pardon to Changpeng Zhao, the founder of Binance. She called it an instance of political corruption that Congress should confront.

This statement came in light of reports indicating that Zhao, widely known as CZ, had been seeking closer relationships with Trump and his associates recently.

According to the Wall Street Journal, Zhao and his collaborators had backed initiatives tied to the Trump family's cryptocurrency ventures, which have drawn attention from US lawmakers.

Trump’s Inner Circle Questions Zhao’s Case

Reports indicate that Trump has told advisers he believes there was unfair targeting of Zhao by prosecutors. Insiders mentioned that Trump regarded the fraud case against Zhao as weak, arguing it did not warrant felony charges or imprisonment.

In a post on social media platform X, Warren remarked, “CZ pleaded guilty to a criminal money laundering charge and was sentenced to prison. But then he financed President Trump’s stablecoin and lobbied for a pardon.” She added, “If Congress does not stop this kind of corruption, it owns it.”

Zhao Denies Role in USD1 Token Financing

Zhao has denied any direct connection with funding Trump’s stablecoin project, USD1, which is associated with World Liberty Financial, a company linked to Trump’s family.

However, Bloomberg reported that Binance contributed technical code that formed the basis of the token’s smart contract. This contract dictated the token's creation and transfer, and it was subsequently used in a $2 billion transaction involving a UAE firm acquiring a stake in Binance.

Zhao publicly dismissed the report as “another hit piece,” claiming it was “sponsored by a competitor.” He accused the outlet of spreading fear and misinformation within the crypto community.

Controversy Over Warren’s Statements

Warren's comments have reignited discussions regarding Zhao's legal history, with critics arguing that she misrepresented his case. They emphasize that Zhao pleaded guilty to not applying adequate anti-money laundering controls rather than being directly involved in money laundering activities.

Zhao’s plea deal in 2023 concluded one of the most significant enforcement actions in American cryptocurrency history. He acknowledged that Binance failed to establish sufficient know-your-customer (KYC) and compliance measures, which facilitated illicit transactions on the exchange.

As part of the settlement, Binance was required to pay a $4.3 billion fine, while Zhao himself paid $50 million and resigned as CEO. He completed a four-month prison sentence in 2024.

Zhao Expresses Gratitude and Commitment Post-Pardon

Following the pardon from Trump, Zhao expressed his “deep gratitude” and committed Binance to helping the United States maintain leadership in the digital asset landscape. “We will do everything we can to help make America the Capital of Crypto and advance web3 worldwide,” he stated.

The decision to pardon Zhao has caused a rift in political opinions. While Warren and several Democratic lawmakers criticized the action as a setback for accountability, many in the crypto sphere view it as a favorable change towards a more equitable treatment of the industry.

This controversy emerges at a critical juncture for cryptocurrency regulation in the United States. While Trump’s administration has supported legislation aiming to clarify oversight of exchanges and stablecoins, Warren continues to advocate for stricter regulations on crypto platforms.