A presidential pardon not only changed the fate of an entrepreneur but could also reshape the power dynamics of the global cryptocurrency market.
U.S. President Trump signed a pardon for Binance founder Changpeng Zhao, marking a significant shift in U.S. cryptocurrency regulatory policy. A White House spokesperson clearly stated that "the Biden administration's war on cryptocurrency is over," prompting a market reaction where BNB surged by 8% at one point, while also sparking intense debate about the relationship between politics and business.
1. Key Events Overview: From SEC Withdrawal to Presidential Pardon
This market-shaking pardon is the latest development in a series of events reflecting a shift in U.S. cryptocurrency regulatory policy over the past few months.
End of the SEC's Legal Battle with Binance
● On May 29, 2025, the U.S. Securities and Exchange Commission (SEC) and Binance jointly submitted a motion to the federal court in Washington, D.C., requesting to withdraw the civil lawsuit against Binance that had been ongoing for nearly two years. This lawsuit was initially filed in June 2023, accusing Binance of mishandling customer funds, misleading investors, and violating U.S. securities laws.
The withdrawal is "with prejudice," meaning the SEC cannot bring a lawsuit on the same matter in the future. Binance called this development a "huge victory for the cryptocurrency sector."
Trump Pardons Changpeng Zhao
On October 24, local time, Trump officially signed the pardon for Changpeng Zhao.
● White House Press Secretary Caroline Levitt stated that Trump "exercised his constitutional power to pardon Mr. Zhao. He is one of the victims of the Biden administration's war on cryptocurrency." She made it clear: "The Biden administration's war on cryptocurrency is over."
● Trump himself told reporters: "Many people suggested pardoning him, many said he committed no crime… he was just persecuted by the Biden administration, this is not a crime."
Timeline
Event
Key Impact
June 2023
SEC sues Binance and Changpeng Zhao
Accuses 13 violations of securities laws
May 29, 2025
SEC and Binance jointly submit motion to withdraw lawsuit
Ends nearly two years of litigation, BNB rises 3.2% that day
October 24, 2025
Trump pardons Changpeng Zhao
BNB surges 8%, Bitcoin rises 3%
Source: Compiled by AiCoin
2. Market Reaction and Analysis: Cryptocurrency Market Rises Across the Board
Following the pardon news, the cryptocurrency market experienced a broad "relief rally," showing a distinctly positive trend.
BNB Leads the Charge, Market Follows
● Binance's main trading token, BNB, performed the best, with prices rising as much as 8%. As the third-largest cryptocurrency after Bitcoin and Ethereum, BNB's market capitalization has reached $157 billion.
● The upward trend spread across the entire cryptocurrency market. The market benchmark Bitcoin rose 3%, and Ethereum increased by 3.7%, indicating a comprehensive positive response from investors to this news.
Jaime Baeza, managing partner of cryptocurrency hedge fund AnB Investments, characterized this market reaction as a "relief rally," indicating that the market had previously harbored concerns about Binance and Changpeng Zhao's legal issues.
Market Structural Stability Under Pressure
● The release of the pardon news came at a time when the cryptocurrency market had just undergone a severe test. On October 11, 2025, a sudden "liquidity shock" caused Bitcoin to plummet over 10%, dropping from $122,000 to $101,500.
● Amid concerns about the market-making mechanism, He Yi recently emphasized in response to data controversies: "Binance contracts take the marked price, which is the weighted average price after extreme prices are excluded from multiple platforms, to avoid extreme prices from a single platform."
3. Mainstream KOL Perspectives: Market Divergence and Consensus
In response to this pardon event, major KOLs in the cryptocurrency market expressed diverse views, revealing deep-seated divergences and consensus within the market.
Supportive and Optimistic Views
Most KOLs view the pardon positively.
● Adam McCarthy, a research analyst at Kaiko, believes the pardon "eliminates a potential obstacle" for Binance and its co-founder, explaining why BNB's gains outpaced other cryptocurrencies.
● Ian Weisberger, CEO of cryptocurrency algorithm platform CoinRoutes, stated that if Binance can resume operations in the U.S., it will open the world's largest cryptocurrency trading venue to U.S. investors, which could "change the game for the U.S. cryptocurrency market."
Technical Analysis and Risk Warnings
Technical KOLs focus on structural market issues.
● Following the recent market crash, well-known KOL "Crypto Veto" pointed out that the order book system's quotes are not based on actual liquidity support, and prices are merely superficial. He believes that in contrast, on-chain automated market makers like Uniswap quote based on the actual depth of liquidity pools, making it harder to "inflate" prices.
● He Yi candidly stated in response to community doubts: "When there are more people, it's hard to manage the team; if you let go and let the team handle it, you have to come out and apologize and clean up. Binance is still the same Binance; execution indeed needs to be polished and polished again."
KOL/Analyst
Position
Core Viewpoint
He Yi
Cautiously Optimistic
Emphasizes that Binance takes marked prices to avoid extreme prices from a single platform
Jerryiscat
Technical Analysis
Believes the root of altcoin crashes lies in the market-making mechanism, not Binance itself
Crypto Veto
Critical Analysis
Points out inherent flaws in the order book system, insufficient liquidity support
Adam McCarthy
Positive Outlook
Believes the pardon "eliminates a potential obstacle" for Binance
Source: Compiled by AiCoin
4. Political Background and Business Relationships: A Complex Web of Interests
The decision to grant the pardon is underpinned by complex political and business interests, sparking widespread discussion.
Trump Family's Business Ties with Binance
● Since Trump's election, Binance has been a significant supporter of the Trump family's cryptocurrency venture, "World Free Finance." This project has greatly enhanced Trump's personal wealth, with profits far exceeding the annual income from the Trump family's real estate projects.
● Binance has been a key player in the rapid development of the USD1 cryptocurrency, which is pegged to the dollar, under "World Free Finance." This spring, the platform accepted an external investment worth $2 billion, with the investment made in USD1, marking the first significant investment for "World Free Finance."
Policy Shift and Industry Impact
● Since taking office in January 2025, the Trump administration has shown a strong pro-cryptocurrency stance.
● In February 2025, the SEC suspended the lawsuit against Binance and established a cryptocurrency task force led by crypto supporter Hester Peirce.
● Trump also signed an executive order to establish a strategic Bitcoin reserve and pardoned several executives in the cryptocurrency industry.
● The Department of Justice disbanded a dedicated cryptocurrency enforcement team, and the new head of the Commodity Futures Trading Commission has close ties to the cryptocurrency industry.
5. Future Outlook: Risks and Dynamics Ahead
Although the pardon has cleared personal legal obstacles for Binance and Changpeng Zhao, the future remains uncertain, and investors should pay attention to the following risks and dynamics.
Potential Risks and Challenges
Political Controversy Risk.
● Critics argue that the pardon decision may involve political quid pro quo. Mark Hays, deputy director of cryptocurrency and fintech policy at the Washington advocacy group "Americans for Financial Reform," stated that this pardon reflects "corruption from the White House" and "paints a dark picture of American politics being improperly influenced."
Regulatory Approval Risk.
● Seoyoung Kim, a finance professor at Santa Clara University, emphasized that Binance's return is "far from guaranteed" and still requires operational approval from the SEC and CFTC.
Global Compliance Challenges.
● The U.S. Department of Justice previously imposed a record $4.3 billion fine on Binance, accusing it of becoming a massive money laundering platform under Changpeng Zhao's leadership.
Key Tracking Points for the Future
● Investors need to closely monitor Binance's application progress with the SEC and CFTC, as this will be a decisive factor for Binance's return to the U.S. market.
● Additionally, the details of the Trump family's "World Free Finance" cryptocurrency business dealings with Binance are also worth tracking, as they may provide key evidence to determine whether the pardon involved a quid pro quo.
● He Yi previously stated: "The essence of Binance is three things: first, to create good products; second, to serve users and employees well; third, to communicate effectively with regulators." This statement may hint at Binance's strategic direction moving forward.
Trump's pardon is not just a piece of paper; it is a watershed moment for U.S. cryptocurrency policy.
Changpeng Zhao's commitment to "helping the U.S. become the cryptocurrency capital" and the approval process of U.S. regulatory agencies will jointly write the next chapter of this drama.
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