Breaking News: Trump reportedly buys stake in Binance

Trump invests in Binance

The Wall Street Journal reported that after completing his four-month prison sentence, Binance reporter Zhao Changpeng (CZ) is actively seeking a pardon from the Trump administration in order to re-expand Binance's US market. (Changpeng is still Binance's largest shareholder, but is restricted from permanently participating in the company's shareholders. The directors' criminal felonies also have an impact on the regulations.)

Binance attempts to enter the US market

According to people familiar with the matter, Binance began to actively contact the Trump family last year, hoping to conclude an alliance with the Trump family and re-enter the U.S. market.

It is not clear how the Trump family will hold shares in Binance US. One possible way is that the Trump family will hold shares directly, and another is through World Liberty Financial, which was established in September last year.

Zhao Changpeng still seeks Binance US comeback after conviction

To recap, Binance agreed to pay a whopping $4.3 billion fine in 2023 to settle allegations of violations by U.S. regulators, when Zhao Changpeng was forced to resign as CEO but retained a majority stake.

For Binance, if Zhao Changpeng can obtain a pardon from the Trump administration, it may improve Binance’s US business development in the international market.

After Binance's U.S. business was significantly reduced due to regulatory pressure in 2023, people familiar with the matter revealed that Binance has set up an internal working group led by current CEO Richard Teng to evaluate different options. The pardon may help Binance repair its U.S. business damaged by long-term legal disputes.

People familiar with the matter also said Binance had internally studied the legal strategy of Sun, a cryptocurrency entrepreneur who became its largest investor through a $30 million investment in World Liberty Financial when he faced charges from the U.S. Securities and Exchange Commission (SEC). Last month, the SEC asked the court to suspend its fraud lawsuit against Sun, raising concerns about the Trump administration’s role in it.

Trump family deals with Binance

People familiar with the matter pointed out that World Liberty Financial, which was co-founded by Trump's two sons and their friend Witkoff, could become direct beneficiaries if the transaction is conducted through the company.

A White House official disputed Tuli's account and said Witkoff was in the Middle East this week negotiating a ceasefire between Israel and Palestine and was traveling to Moscow on Thursday, where he might meet with Russian President Vladimir Putin.

It is understood that the Trump administration is still negotiating with Binance. In addition, the SEC also announced last month that it would suspend another lawsuit against Binance, which is believed to be related to the Trump administration's shift in cryptocurrency policy.

The Trump family's entry may help it turn around

Binance US had a valuation of $4.5 billion in 2022, but due to regulatory issues, its market share plummeted from 27% in 2023 to 1%, resulting in a large number of senior executives leaving the company.

Binance believes that if Zhao Changpeng is granted an amnesty, it will remove regulatory barriers to its U.S. business. The amnesty will also open the door to the European Union, where companies whose shareholders are convicted of crimes such as money laundering will be prohibited from applying for crypto regulatory licenses.

At present, World Liberty Financial, the Trump family and Binance have not responded to this transaction, but if this case continues to move forward, it will inevitably trigger greater controversy from the outside world about the intersection of Trump’s business and political interests.