Democratic Pushback Intensifies Against Trump’s Pardon of Binance Founder CZ

• Symbolic Resolution: Senators Elizabeth Warren and Adam Schiff plan to introduce a Senate measure denouncing Trump’s pardon of Binance founder Changpeng “CZ” Zhao over national security and conflict concerns.
• Trading Ban Proposal: Rep. Ro Khanna seeks to prohibit elected officials, including the president and family, from crypto and stock trading, citing the pardon as evidence of corruption.
• Market Reaction: Trump-linked memecoins surged up to 45% following the president’s defense of the pardon, reflecting divided crypto sentiment.

Washington’s Crypto Divide Deepens. President Donald Trump’s October 23 pardon of Binance co-founder Changpeng “CZ” Zhao has sparked a fresh wave of Democratic criticism, with lawmakers accusing the move of enabling corruption and undermining anti-money laundering safeguards.

Zhao, who pleaded guilty in 2023 to violating the Bank Secrecy Act for inadequate controls at Binance—the world’s largest crypto exchange—served a four-month prison term before his release in September 2024. The exchange faced a $4.3 billion fine, and Zhao a $50 million penalty plus a lifetime ban from U.S. executive roles. Despite this, Zhao rebuilt influence through investments in YZi Labs, advisory positions in Pakistan and Kyrgyzstan, and backing BNB Chain projects, amassing a reported $87.2 billion net worth tied largely to his 90% Binance stake.

The pardon, issued amid reports of Zhao’s ties to the Trump family’s World Liberty Financial—including a $2 billion UAE-backed investment via Binance’s USD1 stablecoin—has fueled allegations of influence peddling. Senators Elizabeth Warren (D-MA) and Adam Schiff (D-CA) announced plans Monday for a symbolic Senate resolution condemning the action, emphasizing intertwined business relationships and risks from Binance’s past failures to block transactions linked to groups like ISIS and Hamas.

“Congress must act to stop public officials, including the president and his family, from such blatant corruption and influence-peddling,” the senators wrote in a letter to colleagues. Though unlikely to pass in the Republican-controlled Senate, the measure underscores tensions ahead of a crypto market structure bill, where Democrats prioritize national security.

Echoing these concerns, Rep. Ro Khanna (D-CA) is advancing legislation to bar elected officials from crypto and stock trading, directly tying it to the pardon. “You’ve got a foreign billionaire who was basically engaged in money-laundering… then he petitions for a pardon from Donald Trump after basically funneling money to terrorists,” Khanna stated, referencing Zhao’s support for World Liberty Financial. The bill, not yet introduced, aligns with bipartisan efforts but highlights Khanna’s own $580 million in trades since 2017.

Trump defended the pardon last week, claiming Zhao was “persecuted by the Biden administration” and backed by many who believe he did nothing wrong. The remarks coincided with a 30% surge in the TRUMP memecoin to over $7.50 and a 45% jump in MELANIA to $0.15, pushing trading volumes past $1 billion and signaling bullish sentiment among some crypto enthusiasts despite the political backlash.

As Binance eyes a U.S. return under CEO Richard Teng, the pardon lifts key barriers but invites scrutiny over enforcement and ethics. Crypto stakeholders await how these developments shape regulatory clarity.

Disclaimer: This article is for informational purposes only and does not constitute advice of any kind. Readers should conduct their own research before making any decisions.