trump’s Pardons Escalate: Zhao case Reveals a ‘Price’ for Clemency
The recent pardon granted to cryptocurrency executive Changpeng Zhao signals a deepening trend under the Trump governance: the leveraging of presidential power for personal and political gain, raising concerns about the integrity of the pardon process.
Alexander Hamilton envisioned the presidential pardon as a “benign prerogative,” an act of mercy exceeding the bounds of law. However, the current administration’s actions, culminating in the pardon of Zhao, suggest a system where clemency is increasingly tied to loyalty and financial benefit.The case echoes past controversies, such as Bill Clinton’s pardons criticized for alleged connections to donations, but on a potentially larger scale.
Zhao, the former CEO of Binance – the world’s largest crypto exchange – pleaded guilty in 2023 to violating anti-money-laundering laws. As part of a settlement with the Treasury Department, Binance agreed to exit the U.S. market and pay a $4.3 billion penalty,while Zhao received a four-month prison sentence.Former Treasury Secretary Janet Yellen characterized Binance’s failures as “willful,” enabling transactions linked to criminal activities, including those involving terrorist organizations like al-Qaeda and the Islamic State. Despite completing his prison term over a year ago, Zhao remained restricted from leading the company.
His newfound freedom appears strategically timed. Reports indicate binance played a role in developing the code for a stablecoin issued by World Liberty Financial, a crypto startup co-founded by Trump’s three sons. Further fueling speculation, an Emirati-backed firm invested $2 billion into Binance using this same stablecoin in may, significantly increasing its value. While the White House claims this transaction is “totally unrelated to any government buisness,” the potential for substantial annual profits for the Trump family and their associates is undeniable.
Zhao actively pursued a pardon, launching a months-long lobbying effort targeting the White House. In February, he retained Teresa Goody Guillén, an attorney from BakerHostetler, who also represents World Liberty Financial and its CEO, Zach Witkoff. The New York Times reported that BakerHostetler collaborates with a firm owned by ches McDowell,a lobbyist and hunting companion of donald Trump Jr., who also reportedly lobbied for Zhao’s pardon. this cultivation of connections seemingly proved accomplished, even if the president struggled to recall Zhao’s name during a recent press briefing, referring to him as “the crypto person” and stating he was “recommended by a lot of people.”
This pardon exemplifies a broader reshaping of the pardon power under Trump. Lee Kovarsky,a professor at the University of Texas School of Law,observes that recent pardons fall into two categories: those benefiting Trump-aligned groups and industries,and those driven by “venality”-a willingness to pardon individuals who make significant financial contributions. The pardon of Ross Ulbricht, founder of the Silk Road, fulfilled a promise made to the crypto community prior to the 2020 election, while the case of Paul Walczak, a convicted tax cheat pardoned in April, raised eyebrows due to his mother’s attendance at a $1 million-per-head trump fundraiser at Mar-a-lago just weeks prior.
Zhao’s clemency appears to serve both purposes: a gesture toward the crypto industry and a reward for the potential financial benefits stemming from the May deal. While Zhao’s future role with binance remains unclear, he has pledged to “help make America the Capital of Crypto,” echoing Trump’s stated ambitions. Experts anticipate the administration may ease penalties on Binance, potentially paving the way for its return to the U.S. market.
“Trump wants everybody to see what the returns on loyalty are,” Kovarsky stated. This year alone, Trump has granted clemency to former Representative George Santos, convicted of fraud and identity theft, and to participants in the January 6th insurrection, some of whom have re-offended after their release. As a colleague, David A. graham,noted in April,while past administrati
