According to a report, Binance, a prominent cryptocurrency exchange, is alleged to have secretly assisted President Donald Trump family’s cryptocurrency firm prior to its founder, Changpeng Zhao, seeking a presidential pardon.
What Happened: Binance is said to have clandestinely written the core code for the Trump family’s stablecoin, USD1. This coin was introduced by World Liberty Financial, a cryptocurrency company set up by Eric Trump and Donald Trump Jr.
The code allegedly facilitated an Emirati investment firm to acquire a $2 billion stake in Binance using USD1. Binance also marketed USD1 to its user base of 275 million.
As per the report by Bloomberg, despite the launch of USD1, both Binance and World Liberty refuted reports of collaborating on a new stablecoin. It is still uncertain whether World Liberty compensated Binance or Zhou for the coin’s creation.
In 2023, Zhou and Binance admitted to violating U.S. anti-money laundering laws. Zhou paid a $50 million fine and stepped down from the company, which also paid $4.3 billion in fines. He later sought a presidential pardon, contradicting his previous denial.
A spokesperson for Binance informed the outlet that Zhou’s pardon request was a personal decision and he no longer has any association with the company. World Liberty dismissed the allegations in the report as politically motivated.
Why It Matters: The allegations against Binance could have significant implications for the cryptocurrency industry. If proven true, it would reveal a major breach of trust and potential violation of regulatory norms by one of the world’s leading cryptocurrency exchanges.
This could lead to increased scrutiny and potentially stricter regulations for the industry. The case also highlights the potential misuse of cryptocurrencies for illicit financial transactions, reinforcing calls for stronger oversight and transparency in the sector.
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