CZ Disputes Trump Business Ties Following Presidential Pardon

DAVOS, Switzerland — Changpeng “CZ” Zhao, the billionaire founder and former CEO of Binance, is moving to distance himself from the Trump family’s business empire, characterizing reports of a formal partnership as a fundamental misunderstanding of crypto-asset transactions.

Speaking with CNBC’s Andrew Ross Sorkin at the World Economic Forum on Thursday, Zhao addressed the cloud of speculation surrounding his October 2025 presidential pardon. Despite a complex web of transactions involving a Trump-linked stablecoin and a massive sovereign wealth investment, Zhao maintains that no formal alliance exists between the world’s largest crypto exchange and the First Family.

The Big Picture

The controversy centers on whether a $2 billion investment into Binance was a bridge to political favor. Critics have pointed to the use of USD1, a stablecoin issued by the Trump-founded World Liberty Financial (WLFI), as evidence of a quid pro quo. Zhao’s defense is simple: he wanted crypto, not a political connection.

• The Deal: In March 2025, the Abu Dhabi state-backed firm MGX invested $2 billion into Binance.
• The Currency: MGX chose to facilitate the payment using USD1.
• The Outcome: Months later, President Trump issued a full pardon for Zhao’s 2023 money laundering convictions.

Why It Matters

The intersection of digital asset regulation, sovereign wealth, and executive clemency has created a firestorm for both Binance and the White House. For Zhao, the goal is to preserve his remaining influence at Binance and mitigate the "bad actor" label that followed his four-month prison stint.

Zhao’s Defense: "Just a Currency"

During the Davos interview, Zhao was emphatic that the choice of payment medium was not his directive, but rather a byproduct of his desire to avoid traditional banking rails.

"There’s no business relationships whatsoever," Zhao told Sorkin. "MGX is the investor. They choose USD1. My request to them was they pay us in crypto. I don't want to deal with banks, really."

Zhao argued that accepting a stablecoin is not an endorsement or an investment in the issuer:

• Transactional Nature: Zhao likens the use of USD1 to a merchant accepting a specific credit card.
• Divestment: Binance has since converted the $2 billion USD1 investment into other assets in staggered portions.
• Distance: He insists the relationship with the Trump family has been "misconstrued" by the media and political rivals.

The Backstory: From Prison to Pardon

To understand the gravity of the current situation, one must look at Zhao’s rapid fall and controversial redemption:

1. November 2023: Zhao pleads guilty to violating the Bank Secrecy Act. Binance pays a record $4.3 billion settlement to the DOJ. Zhao resigns as CEO.
2. June 2024: Zhao begins serving a four-month sentence in a federal correctional facility.
3. September 2024: Zhao is released, maintaining a majority stake in Binance but legally barred from day-to-day management.
4. October 2025: President Trump grants Zhao a full pardon, citing his contributions to the American technological landscape.

The World Liberty Financial Stance

World Liberty Financial, the crypto venture launched by Donald Trump and his sons, has also moved to stifle rumors of a "pardon-for-investment" scheme.

In a statement to CNBC, spokesperson David Wachsman stated:

"As we have stated many times, WLFI is not a political organization and had zero role in the pardon process. To imply otherwise is dangerous and false."

The MGX Connection

The $2 billion investment by MGX is the pivot point of this controversy. MGX, an AI and technology investment vehicle chaired by UAE National Security Advisor Sheikh Tahnoon bin Zayed Al Nahyan, has become a power player in global tech.

By using USD1 to fund its Binance stake, MGX effectively placed the Trump-linked stablecoin at the center of the world's most significant crypto transaction of 2025.

Key Context:

• Binance has deep roots in the UAE, where Zhao resided for years.
• The use of USD1 provided a massive liquidity boost to the Trump-linked project at a critical time.
• Critics argue this created a "financial circularity" that benefited the President’s private interests while he held the power of the pardon.

The Compliance Challenge

Despite the pardon, Binance remains under the watchful eye of a court-appointed monitor—a condition of its 2023 settlement. Zhao’s presence in Davos and his public comments suggest a man eager to return to the vanguard of the industry, even if he cannot officially hold an executive title.

What Binance is Doing Now

• Liquidity Management: Systematically moving out of USD1 to diversify its treasury.
• Regulatory Buffering: Doubling down on "compliance-first" rhetoric to satisfy the DOJ monitor.
• Institutional Pivot: Focus on sovereign wealth partnerships (like MGX) to replace retail-heavy volatility.

Implications for the Crypto Industry

The "CZ Pardon" and the subsequent fallout represent a new era of "Politicized Finance" in the digital asset space.

1. The "Too Big to Jail" Precedent

The pardon of a founder who oversaw systemic money laundering violations sends a mixed message to the industry. While it signals a pro-crypto stance from the White House, it complicates the efforts of the SEC and DOJ to enforce strict AML (Anti-Money Laundering) standards.

2. Stablecoin Legitimacy

The use of USD1 in a $2 billion transaction proves that "political stablecoins" can achieve institutional velocity. However, the scrutiny following this deal may make other sovereign funds hesitant to use assets with high-profile political ties.

3. Zhao’s Future Role

While Zhao claims he is "done" with the CEO role, his majority ownership means he remains the ultimate authority at Binance. His appearance at Davos—a venue for the global elite—signals that he intends to remain a "statesman" of crypto, regardless of the legal or political controversies trailing him.

What’s Next

The U.S. House Financial Services Committee is expected to hold hearings later this year regarding the oversight of stablecoins, with USD1 likely to be a primary case study.

For Zhao, the path forward involves a delicate balancing act: maintaining the $2 billion infusion from MGX while convincing global regulators that the "misconstrued" relationship with the Trump administration won't lead to further compliance lapses.

The Bottom Line: Zhao is free and Binance is funded, but the optics of the $2 billion USD1 transaction have ensured that neither will be free from federal scrutiny anytime soon.