A group of Senate Democrats is moving to formally condemn President Donald Trump’s pardon of Binance founder Changpeng Zhao (CZ), arguing that it sends a troubling message to financial executives convicted of regulatory or compliance violations.
The letter, dated October 28, 2025, was addressed to Attorney General Pamela Bondi and Treasury Secretary Scott Bessent, and signed by several Democratic senators. It requests clarification on how the pardon might affect federal efforts to prosecute financial crimes and enforce anti-money-laundering standards.
Concerns Over Accountability and Deterrence
The senators wrote that President Trump’s pardon “sends the wrong signal” to the financial industry, particularly to crypto executives, by implying that those convicted of compliance-related offenses could avoid consequences if they maintain political ties.
🇺🇸 NEW: Senate Democrats are moving to condemn Trump’s pardon of CZ.
They say a crypto-industry executive getting a free pass after a guilty plea sends the wrong signal. pic.twitter.com/ggf8XdT60a
— Cointelegraph (@Cointelegraph) October 29, 2025
They warned that the decision “seems likely to encourage, rather than discourage, criminal activity,” undermining federal deterrence efforts. The letter also questioned whether the pardon could complicate enforcement actions against other companies found in violation of the Bank Secrecy Act or sanctions laws.
Background: DOJ’s Case Against Binance
In November 2023, the U.S. Department of Justice reached a $4 billion settlement with Binance, then the world’s largest cryptocurrency exchange, following a multiyear investigation into alleged violations of anti-money-laundering and sanctions regulations.
Under the agreement, Binance admitted that its compliance failures had allowed funds to flow through accounts linked to terrorist organizations, sanctioned regimes, and criminal networks. The company was required to appoint a compliance monitor and enhance its regulatory oversight.
At the time, CZ pleaded guilty to failing to maintain an effective anti-money-laundering program, a charge under the Bank Secrecy Act, and was sentenced to four months in prison.
President Trump’s pardon of Zhao nullified the conviction, sparking immediate backlash from lawmakers and advocacy groups who argued that it undermined accountability for executives overseeing financial crimes.
Broader Political and Industry Reaction
The move has reignited partisan debate over the administration’s crypto policy. Supporters of the pardon have framed it as a gesture toward promoting innovation and economic freedom, while critics see it as evidence of selective leniency toward powerful industry figures.
Crypto industry observers say the controversy could intensify scrutiny of future enforcement actions and delay bipartisan progress on digital asset regulation, including upcoming debates on the Crypto Clarity Act and proposed stablecoin frameworks.
Legal Context and Next Steps
Senate Democrats are expected to introduce a non-binding resolution condemning the pardon in the coming days. While largely symbolic, it reflects growing concern in Washington over how executive clemency may intersect with the ongoing regulation of the cryptocurrency sector.
For now, the Department of Justice and the Treasury have not issued official responses to the Senate letter. However, both agencies are reportedly reviewing whether the pardon affects ongoing compliance monitoring obligations imposed on Binance as part of its 2023 settlement.