Binance Founder CZ Pardoned, is SBF next?

The Trump Administration has been unashamedly pro-crypto, seeking to craft innovation supporting rules and changing the leadership at the previously anti-crypto Securities & Exchange Commission.

This approach has dialed up further with news that Binance founder Changpeng “CZ” Zhao has been pardoned today for his conviction in connection with a prosecution of Binance for breaching sanctions and anti-money laundering laws.

After the Department of Justice commenced that prosecution, CZ voluntarily travelled to the United States, where a plea deal was agreed, CZ stood down as CEO and was sentenced to 4 months imprisonment. The sentence was very unusual in that, as his lawyers pointed out in relation to banking anti-money laundering breaches:

no defendant in a remotely similar ... case has ever been sentenced to incarceration

Binance paid a US $4.3B fine in connection with the plea deal. The Wall Street Journal reported that Binance had been campaigning for a pardon for CZ for much of the last year.

The White House Press Secretary reportedly said:

President Trump exercised his constitutional authority by issuing a pardon for Mr. Zhao, who was prosecuted by the Biden Administration in their war on cryptocurrency...[i]n their desire to punish the cryptocurrency industry, the Biden Administration pursued Mr. Zhao despite no allegations of fraud or identifiable victims

Earlier this year the founders of BitMex were also the subject of a pardon, and recently news broke concerning allies of Sam Bankman-Fried ("SBF") agitating for a pardon, with the publication of a piece titled:

FTX Was Never Insolvent: My Prison Interview with Sam Bankman-Fried

It seems SBF would face a far higher hurdle to a pardon, having pled not-guilty to accusations of fraud over the collapse of FTX and having been convicted, versus CZ striking a plea deal over allegations not involving loss of funds or fraud.

By Michael Bacina