In a stunning development that signals a dramatic shift in U.S. crypto policy, President Donald Trump granted a full pardon to Changpeng "CZ" Zhao, the founder and former CEO of Binance, the White House confirmed Thursday. The pardon erases Zhao's criminal conviction for violating federal anti-money laundering laws and removes all remaining legal disabilities stemming from his 2023 guilty plea.
"President Trump exercised his constitutional authority by issuing a pardon for Mr. Zhao, who was prosecuted by the Biden Administration in their war on cryptocurrency," White House Press Secretary Karoline Leavitt said in a statement to media outlets. "The Biden Administration's war on crypto is over."
The pardon, signed Wednesday according to The Wall Street Journal, comes roughly one year after Zhao completed a four-month federal prison sentence at a minimum-security facility in Lompoc, California. The Canadian citizen, who built Binance into the world's largest cryptocurrency exchange, had pleaded guilty in November 2023 to causing his company to fail to maintain an effective anti-money laundering program.
From Federal Prison to Presidential Clemency
Zhao's legal troubles culminated in April 2024, when U.S. District Judge Richard Jones sentenced him to four months in prison — a relatively lenient sentence compared to the three years federal prosecutors had sought. The sentence came as part of a historic $4.3 billion settlement between Binance and the U.S. Department of Justice, marking one of the largest corporate penalties in American history.
Under the terms of the November 2023 plea agreement, Zhao admitted to violating the Bank Secrecy Act by failing to implement proper Know Your Customer and anti-money laundering controls at Binance. Federal prosecutors accused the exchange of enabling transactions with users in sanctioned jurisdictions including Iran, Cuba, Syria, and Russian-occupied regions of Ukraine.
Attorney General Merrick Garland called the settlement a watershed moment at the time, declaring that "Binance became the world's largest cryptocurrency exchange in part because of the crimes it committed."
Zhao paid a $50 million personal fine and agreed to step down as Binance CEO, turning control over to former Abu Dhabi regulator Richard Teng. He reported to FCI Lompoc II on May 31, 2024, and was released ahead of schedule on September 27, 2024 — two days before his official release date due to federal guidelines allowing weekend early releases.
At an estimated net worth of $25.3 billion according to Bloomberg, Zhao is believed to be the richest person to ever serve time in a U.S. federal prison.
Trump's Expanding Pattern of Crypto Pardons
The pardon makes Zhao the latest figure in the cryptocurrency industry to receive clemency from Trump, following the administration's March 2025 pardons of BitMEX co-founders Arthur Hayes, Benjamin Delo, and Samuel Reed, who had pleaded guilty to similar Bank Secrecy Act violations in 2022.
"This full and unconditional pardon by President Trump is a vindication of the position we have always held — that BitMEX, my co-founders and I should never have been charged with a criminal offense through an obscure, antiquated law," Delo said at the time.
Trump has also pardoned Trevor Milton, founder of electric truck maker Nikola, who was convicted of securities fraud, and commuted the sentence of George Santos, the disgraced former New York congressman. The president has made clear his view that the previous administration unfairly targeted cryptocurrency businesses as part of what he characterizes as regulatory overreach.
According to reports, the pardon followed months of lobbying efforts by Zhao and his associates, with discussions reportedly ramping up in October 2025. Financial journalist Charles Gasparino reported that Trump was "leaning toward a pardon" despite concerns about optics given the president's family business interests in cryptocurrency.
World Liberty Financial Connection
Zhao's path to clemency appears to have been smoothed by his support for World Liberty Financial, a crypto venture launched by the Trump family. The Wall Street Journal reported that Zhao's team worked to boost the project as part of their broader outreach to the Trump administration.
World Liberty Financial has issued its own stablecoin, USD1, with backing from Binance's infrastructure. The connection between Zhao's pardon and his support for Trump family business ventures has raised eyebrows among ethics watchdogs, though the White House characterized the decision purely in terms of correcting Biden-era prosecutorial overreach.
"In their desire to punish the cryptocurrency industry, the Biden Administration pursued Mr. Zhao despite no allegations of fraud or identifiable victims," Leavitt said in the statement.
Market Reaction and Business Implications
BNB, Binance's native token, surged more than 5% in the immediate aftermath of the pardon announcement, reaching an intraday high of $1,138 according to CoinGecko data. The token had already been trading at elevated levels in recent weeks as speculation about a potential pardon intensified, with prediction markets on Polymarket valuing the chances of clemency at over 60% at one point in September.
The pardon removes all legal disabilities associated with Zhao's felony conviction. Practically, this means Zhao can now enter the United States without restrictions, apply for business licenses, and engage with U.S.-regulated entities without triggering automatic compliance bans. It also restores his civil rights, including voting eligibility and the ability to hold executive roles in U.S.-registered companies.
However, Zhao's immediate return to a management role at Binance remains unlikely. The company's 2023 plea agreement with the Department of Justice includes binding provisions that prohibit him from participating in Binance's management or governance for three years following the appointment of an independent compliance monitor. That prohibition extends through at least November 2026.
Binance continues to operate under court-appointed monitors with sweeping powers to oversee the exchange's business practices, including customer onboarding procedures and interactions with sanctioned jurisdictions. The company also agreed to enhanced reporting requirements and regular audits as part of the settlement.
A Rehabilitated Reputation
For Zhao personally, the pardon represents a dramatic rehabilitation of his status in global finance. In a post on X (formerly Twitter) following his release from prison in September 2024, the entrepreneur outlined plans to focus on his education startup Giggle Academy, aimed at reducing global illiteracy through free online education.
"I will continue to invest in blockchain/decentralized technologies, artificial intelligence, and biotechnology," Zhao wrote. "I am a long-term investor who cares about impact, not returns."
The former CEO had previously acknowledged seeking a pardon, telling a podcast in May 2025 that "no felon would mind a pardon, especially being the only one in US history who was ever sentenced to prison for a single BSA charge."
Industry observers note that Zhao's pardon could have far-reaching implications for how cryptocurrency businesses are regulated and prosecuted in the United States. The move sends a clear signal that the Trump administration views many previous enforcement actions as politically motivated rather than justified by legitimate compliance concerns.
Regulatory Landscape Shift
The pardon comes amid a broader recalibration of cryptocurrency regulation under the Trump administration. Since taking office in January 2025, Trump has appointed crypto-friendly regulators to key positions at financial watchdog agencies and has pushed for the passage of legislation providing regulatory clarity for digital assets.
The GENIUS Act, which Trump signed into law in July 2025, established the first comprehensive federal framework for stablecoins, requiring 100% reserve backing and monthly public disclosures of reserve composition. The legislation represents a stark departure from the enforcement-heavy approach favored by Biden administration officials.
Critics of the pardon argue that it undermines accountability for serious compliance failures at a systemically important financial institution. Amanda Fischer, former Chief of Staff to ex-SEC Chair Gary Gensler, warned earlier this year that Zhao's conviction "was a warning to crypto exchanges operating outside established compliance standards."
However, supporters contend that Zhao's case was an outlier — he remains the only person ever sentenced to federal prison for a single Bank Secrecy Act charge, despite similar violations by traditional financial institutions resulting in civil penalties only.
What's Next for Binance and CZ
While the pardon clears Zhao's criminal record, questions remain about his future role in the cryptocurrency industry. The 48-year-old founder retains a substantial ownership stake in Binance, estimated to represent billions of dollars in value, but cannot directly manage the company's operations until at least late 2026.
Binance itself has worked to distance its operations from its founder's legal troubles, investing heavily in compliance infrastructure and hiring experienced regulatory professionals. The exchange reported in recent months that it was in discussions with the Justice Department about potentially reducing the scope of its external monitoring arrangement ahead of schedule.
Zhao has suggested his post-Binance focus will center on education, philanthropy, and passive investment in emerging technologies. Whether the pardon enables him to play a more active role in building new ventures remains to be seen, but the removal of his conviction certainly expands his options considerably.
For now, the pardon stands as perhaps the clearest signal yet of the Trump administration's commitment to what it characterizes as ending the "war on crypto" — a message likely to resonate throughout an industry that has long chafed under what it views as hostile regulatory treatment.
As Zhao's case moves from the courts to the history books, one thing is certain: his journey from building the world's largest crypto exchange to federal prison and back to freedom will remain one of the most consequential stories in cryptocurrency's short but turbulent history.