President Donald Trump’s decision to pardon crypto billionaire Changpeng Zhao has raised strong concerns about possible misuse of presidential power. Zhao, the founder of Binance, received a full and unconditional pardon last month, despite a Justice Department case that accused him of causing “significant harm to U.S. national security.”
Zhao and Binance pleaded guilty in 2023 to failing to prevent money laundering. The company paid a $4 billion fine, and Zhao served four months in prison.
Elizabeth Oyer, former head of the Justice Department’s pardon office, said Zhao did not meet federal guidelines for a pardon. She called the pardon “unprecedented” and said the decision showed “corruption” because of financial benefits tied to the Trump family.
The concerns center on World Liberty Financial, a crypto firm launched by the Trump family during the 2024 campaign. The company struggled to gain traction, but sources say Binance later provided software to help the firm build a cryptocurrency product. According to one source, without Binance’s tools, “the technology doesn’t exist.”
In May, a major sovereign fund from the United Arab Emirates invested $2 billion into Binance, using World Liberty’s new digital currency to complete the deal. This moved World Liberty from an obscure startup into one of the largest stablecoin issuers almost overnight. Experts called the rapid rise “unusual” and “nuts.”
Harvard law professor Lawrence Lessig said the arrangement creates a risk that the president is “compromised,” because foreign governments and private companies may try to influence policy through investments tied to the Trump family’s business interests.
The investment also remains deposited at World Liberty. Analysts say the $2 billion could generate about $80 million a year in interest for the company and its partners. Sources told CBS News that this gives Zhao major leverage over World Liberty because he could withdraw the funds at any time.
Two weeks after the Emirati deal, Trump announced expanded U.S. cooperation with the UAE on artificial intelligence technology. There is no evidence linking this policy decision to the crypto investment.
When news of the pardon leaked, Trump said he did not know Zhao and believed Zhao had been treated unfairly by the Biden administration. The White House said the president and his family had no conflicts of interest. Eric Trump, co-founder of World Liberty, said his father “has nothing to do with our company.”
Legal experts disagree. Constitutional scholar Michael Gerhardt said Trump can still benefit financially through his family’s trust and that the arrangement represents a “classic conflict of interest.”
Neither World Liberty nor Binance agreed to interviews. Lawyers for Zhao denied providing any special support and said any software shared was “freely available.” World Liberty’s lawyers said the company had no contact with the president about Zhao’s pardon.
Zhao is not the only controversial pardon in recent years. President Biden pardoned his son for tax and gun offenses, and President Clinton pardoned financier Marc Rich after major donations from Rich’s ex-wife.
Oyer, who says she was fired earlier this year for refusing to approve another politically sensitive pardon, warned that the Trump administration is using pardons as “rewards for friends, allies, and donors.” She said she fears the pardon process is being used to “sell off pieces of our democracy.”
Lessig added that the combination of political money and private business interests inside the executive branch makes the current situation “the most extreme it’s ever been,” at a time when public trust in government is already low.
Zhao did not comment to CBS News. On FOX News, he said he has “no business relationship with any of the sons of President Trump.” Binance still holds about $2 billion inside World Liberty Financial.
