President Trump has pardoned Binance founder Changpeng Zhao, who created the world's largest cryptocurrency exchange and served prison time after failing to stop criminals from using the platform to move money connected to child sex abuse, drug trafficking, and terrorism. Zhao had filed an application for a pardon and hired lobbyists. He has deep ties to World Liberty Financial, a crypto venture that the president and his sons Eric and Donald Jr. launched last year, the AP reports. Trump's most recent financial disclosure report reveals he made more than $57 million last year from World Liberty Financial, which has launched USD1, a stablecoin pegged at a 1-to-1 ratio to the US dollar.
World Liberty Financial also recently announced that an investment fund in the United Arab Emirates would be using $2 billion worth of USD1 to purchase a stake in Binance. White House press secretary Karoline Leavitt said in a statement Thursday that the Biden administration prosecuted Zhao out of a "desire to punish the cryptocurrency industry," the AP reports. "The Biden Administration's war on crypto is over," she said. Leavitt said there were "no allegations of fraud or identifiable victims," though Zhao pleaded guilty to one count of failing to maintain an anti-money-laundering program and Binance agreed to pay a $4.3 billion settlement.
"I failed here," Zhao told the court last year. "I deeply regret my failure, and I am sorry." In a sentencing memorandum, federal prosecutors said: " He made a business decision that violating US law was the best way to attract users, build his company, and line his pockets." Zhao, who was Sam Bankman-Fried's main rival before the collapse of the FTX exchange, lives in Dubai. He completed his prison sentence in September last year, but his criminal record has complicated Binance's international business dealings, the Wall Street Journal reports.
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In May, three Democratic senators including Sen. Elizabeth Warren, the top Democrat on the Senate Banking Committee, asked the administration for information on its dealings with Zhao as he pushed for a pardon, the Wall Street Journal reported at the time. "The convergence of Mr. Zhao's pardon application and Binance's financial entanglements with the president's family presents urgent concerns regarding the integrity of our justice system," they said.
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