CZ (sort of) denies Binance talks to Trump re pardon, investment

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Binance reportedly held talks with Donald Trump’s family members about taking a stake in the digital asset exchange, but founder Changpeng ‘CZ’ Zhao denied that he was lobbying the U.S. President for a criminal pardon.

• Deal or no deal
• CZ denies Binance has any deal with Trump
• CZ (sort of) denies he’s pushing for a pardon
• Binance saw Justin Sun’s ‘investment’ in Trump DeFi project as a blueprint
• UAE takes $2 billion stake in Binance

On March 13, the Wall Street Journal reported “representatives of President Trump’s family have held talks to take a financial stake” in Binance’s U.S.-focused Binance.US offshoot. Binance.US has struggled ever since the $4.3 billion legal settlement its parent company reached with the U.S. Department of Justice (DoJ) and other federal agencies in November 2023, which led to disruptions in its ability to transact with U.S. banks.

The talks reportedly began after Binance execs “reached out to allies of Trump last year offering to strike a business deal with the family as part of a plan to return the exiled company to the U.S.” Said allies reportedly include Steve Witkoff, a longtime friend of the president’s and his current special envoy to the Middle East (and, apparently, Russia).

The White House denied Witkoff’s involvement in any Binance talks, adding that Witkoff is in the process of divesting from his business interests. Witkoff co-founded World Liberty Financial (WLF), Trump’s decentralized finance (DeFi) project. The WSJ claimed a Binance deal could be done either via the Trump family taking a direct stake or doing it via WLF.

Bloomberg subsequently reported that WLF and Binance had discussed the possibility of jointly developing a U.S. dollar-denominated stablecoin but couldn’t say how far those talks progressed nor if any deal might be reached. Rumors of a WLF-based stablecoin surfaced last October, but little has been heard about this subject since then.

Wasn’t me

CZ somewhat denied the WSJ’s report via his X account, saying the report “got the facts wrong.” CZ said “I have had no discussions of a Binance US deal with … well, anyone,” which doesn’t rule out the possibility that other Binance stakeholders or senior execs had such discussions.

In a separate tweet, CZ accused Bloomberg of writing a “baseless hit piece” based on the WSJ’s reporting. CZ called Bloomberg’s article “purely imaginary” and claimed that “I/Binance have no business deals with WLF or the people mentioned in their article. We also did not buy any of the WLF coins.”

Note that CZ doesn’t deny that meetings or talks took place, merely that he didn’t personally take part and that no deal has yet been reached. (And it’s not like CZ hasn’t been known to disseminate blatant falsehoods when he feels it’s in his interest to do so.) No statement has yet been issued by WLF, the Trump Organization, nor any current Binance execs.

At a Singapore conference just before the WSJ’s report, Binance CEO Richard Teng praised Trump’s “pro-crypto” stance and said, “In the crypto industry, people prefer the current administration to the last one.” Teng also hailed Trump’s recent ‘strategic Bitcoin reserve’ announcement as a “landmark” step that will spur similar moves by other nations.

Following Binance’s legal settlement, the U.S. market share of Binance.US fell from 27% to 1%. Last month, Binance.US regained limited access to U.S. dollar services, but the exchange remains a ghost town, recording only $10 million in daily trading volume on March 13.

Teng said last month that Binance.US would have “a fresh reset and restart” thanks to Trump’s embrace of the digital asset sector and the resulting attitude shift by American regulatory agencies—including those in the banking sector.

The WSJ was already on the president’s naughty list for criticizing his economic strategies, particularly for imposing or threatening to impose punitive financial tariffs on many of America’s largest trading partners, including Canada, Mexico and the European Union.

On March 13, shortly before the WSJ’s Binance article was published, Trump posted to his Trump Media-owned Truth Social platform that “[t]he Globalist Wall Street Journal has no idea what they are doing or saying.” The post appeared to focus on the WSJ’s criticisms of his tariffs rather than the alleged Binance-Trump discussions.

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Pardon me

As the WSJ notes, while Trump has made major bank from his various crypto activities—including WLF, the memecoins he and his wife Melania issued and his multiple non-fungible tokens (NFT) collections—a Binance investment would be a horse of a different color, given that CZ remains both Binance’s largest shareholder and a convicted felon.

In April 2024, as part of the 2023 DoJ settlement, CZ was sentenced to four months in federal prison after pleading guilty to charges of violating and causing a financial institution to violate the Bank Secrecy Act (BSA). However, the WSJ reported that CZ “has been pushing for the Trump administration to grant him a pardon.”

As part of CZ’s plea deal, he was forced to step down from any executive role at Binance. A pardon would eliminate this restriction, giving CZ a powerful incentive to curry Trump’s favor. It could also open regulatory doors in other markets that tend to frown on companies owned by criminals.

Asked why outlets like the WSJ and Bloomberg continue to write articles that reflect negatively on Binance, CZ went full conspiracy theorist, asking whether these outlets “might be getting paid to do so?” CZ offered no theories on who might be willing to pay to see him and Binance taken down a peg.

Yi He, Binance co-founder and mother of CZ’s children, took a slightly different tack, suggesting CZ “give it a try and apply” for a pardon. “What if the amnesty actually happens? Believe that good things will always happen.” Yi He helpfully tagged Trump in her tweet.

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Justin blazed this trail

It’s not like the Trump family appears all that intimidated by the possibility of teaming up with a crypto ne’er do well. After all, Trump himself is a convicted felon, although he was granted an unconditional discharge after winning last November’s presidential election.

For years now, Tron founder Justin Sun has been the subject of damning media reports—although some of his allegedly fraudulent activities are in the process of being forgiven by the U.S. Securities and Exchange Commission (SEC)—but that didn’t stop WLF from making Sun an advisor last November.

Sun’s appointment came shortly after he rode to WLF’s financial rescue by buying $30 million worth of its ‘governance’ token WLFI. Subsequent purchases boosted Sun’s WLFI stake to $75 million, making him one of WLFI’s most high-profile whales.

Sun’s purchases came as sales of WLFI slowed dramatically following its October initial coin offering, which resulted in only around $21 million of its initial goal of $300 million worth of WLFI having been sold. Sun’s buys also put money directly in the pockets of Trump’s family; as a Trump-owned corporation, it stood to gain 75% of WLF’s net revenues—including WLFI sales—once sales topped $30 million.

The WSJ report claimed that Binance’s senior execs saw a ‘potential legal playbook’ in WLF’s embrace of Sun. Binance even considered making a similarly large WLF investment as a direct quid pro quo for CZ’s pardon. The normally chatty Sun has yet to publicly comment on the WSJ report.

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Abu Dhabi to the rescue

Last month, both CZ and Yi He denied rumors that Binance was shopping itself for a buyout/takeover, with both claiming the rumors emanated from unspecified ‘competitor(s)’. But while CZ said, “Binance is not for sale,” he suggested “we may allow some investments in the single-digit percentage range.” Yi He added that Binance wouldn’t “rule out the introduction of strategic partners and are open to mergers and acquisitions.”

On March 12, Binance announced that MGX Fund Management Ltd had taken a $2 billion stake in the company, marking not only the first institutional investment in Binance but the largest single investment in any crypto firm as well as the largest investment made via stablecoin. The specific stablecoin(s) used in this investment went unmentioned.

MGX is owned by the United Arab Emirates (UAE) government and was formed to boost the state’s stakes in artificial intelligence (AI) and other advanced technologies. MGX has made investments in OpenAI, Databricks, and Elon Musk’s xAI while also contributing to the Stargate Project, which is aimed at developing U.S. infrastructure for OpenAI.

Binance CEO Teng—who, incidentally, previously served as CEO of the Abu Dhabi Financial Services Authority—called the investment “a significant milestone for the crypto industry and for Binance. Together, we are shaping the future of digital finance … Our ongoing investments in security and compliance reinforce our mission to foster a secure and trusted digital financial ecosystem.”

MGX CEO Ahmed Yahia said the investment “reflects our commitment to advancing blockchain’s transformative potential for digital finance. As institutional adoption accelerates, the need for secure, compliant, and scalable blockchain infrastructure and solutions has never been greater.”

Some observers have questioned why Binance—the unquestioned market-leading exchange in terms of trading volume—would seek such a major investment by an outside entity.

The company’s 2024 ‘year in review’ report spoke of the exchange exceeding $160 billion in user assets under custody for the first time, while it’s $30 billion in inflows “surpassing the combined totals of the next ten largest crypto platforms by a significant margin.”

Binance Earn saw its total value locked grow by 144% last year, while Binance Pay’s active user base grew by 226%. Average daily trading volume grew 27%, and cumulative trading volume across all products topped $100 trillion.

So it’s unlikely that Binance’s profits have taken a serious turn for the worse. That is unless all those court-ordered compliance upgrades take a bigger bite out of the exchange’s bottom line than they’ve let on. (The company now claims to have 650 compliance staff on its payroll, which might be 650 more than pre-settlement.)

Some have noted that, while Binance continues to deny that any jurisdiction is its official headquarters, one-fifth of its global workforce is UAE-based, so there are lots of reasons to keep the local authorities happy—and financially invested in Binance’s future.

Others have noted that the DoJ’s schedule for Binance to pay the final $1.8 billion portion of the $4.3 billion penalty was 15 months after CZ’s sentencing, which occurred on April 30, 2024. That puts the deadline for the final delivery of the $1.8 billion at the end of July 2025. Hmmm…

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