CZ's private lawyer discusses the controversy over Trump's pardon: responds to allegations of political dealings.

Compilation | Wu Talks Blockchain

In this episode, Anthony Pompliano's podcast focuses on the event of Trump pardoning Binance founder CZ (Changpeng Zhao), with CZ's lawyer Teresa Goody Guillén clarifying that the nature of the case is a compliance violation rather than a crime, emphasizing that the pardon is based on considerations of “judicial fairness.” She systematically refuted the media and political conspiracy theories about “money transactions” or “political interests exchange,” pointing out the lack of evidence and misunderstandings about the Blockchain mechanism. Additionally, the program discussed the background of the U.S. crackdown on the crypto industry, the rigor of the pardon process, CZ's personal attitude towards the matter, and the future situation of Binance and the U.S. crypto market.

The audio transcription is completed by GPT and may contain errors. The guest's views do not represent Wu's views, and readers are advised to strictly follow the laws and regulations of their location. Please watch the full content on YT:

The legal reason for CZ's pardon: Compliance violation without victims.

Anthony: Today we have a very important and serious conversation, and I will be speaking with Theresa Goody Guillén. She is CZ's private attorney and has been deeply involved in the entire process of his pardon. There is a lot of controversy online about why he was pardoned, whether there was any quid pro quo, and if there is corruption involved. I reached out to Theresa to discuss these issues, whether they are simple questions or sharp inquiries, we will bring them up today. This is my conversation with Theresa Goody Guillén. Theresa, you are here today to reveal the details behind CZ's pardon and to address many of the criticisms from outsiders. Can you help us clarify what CZ was actually accused of? What is the logical basis for his pardon?

Teresa: He is accused of failing to implement and maintain anti-money laundering compliance procedures at Binance. It needs to be clarified that this is merely a regulatory violation issue, a matter of compliance, and does not involve any actual money laundering activities. It is simply that Binance failed to establish a set of anti-money laundering procedures.

The reason he was granted a pardon is that he should not have been prosecuted from the very beginning. The president also clearly stated when signing the pardon that he does not believe CZ has committed any crimes and does not understand why he was prosecuted. The essence of this pardon is to achieve justice.

CZ is the only person in history who has been prosecuted and even sentenced for this kind of accusation — no fraud, no victims, no criminal record. The treatment he received is completely different from that of all other similar cases in history.

Selective law enforcement under the background of crypto suppression

Anthony: Why do you think CZ is treated differently?

Teresa: I think this is part of the “war on cryptocurrency.” It was shortly after the FTX collapse, and the entire regulatory environment was highly tense. I feel that regulators needed to “find someone to scapegoat” in this context; they had to prosecute someone, even to “sacrifice” a representative. Unfortunately, this target ultimately became Binance and CZ.

Anthony: If I understand correctly, it's because the company has not fulfilled its relevant responsibilities, which is why the regulatory authorities have launched an investigation. In this case, do corporate executives need to bear legal responsibility? On one hand, some may think that the CEO should be responsible for the company's actions; on the other hand, I found through some simple searches that large banks or financial institutions have faced similar accusations, but their executives are usually not held accountable. What exactly is the standard of enforcement in this case? What is the difference between corporate and individual responsibility?

Teresa: You are absolutely right. In similar cases, executives have never been prosecuted. You can name any large financial institution, and they have likely been investigated for the same or even more serious violations, but I've never seen the CEOs of these companies held accountable. This is something that almost never happens in the judicial system; it's always been this way. Therefore, prosecuting CZ in this case is an extremely unusual situation.

Detailed Explanation of the Pardon Application Process: Review Mechanism and Standard Procedures

Anthony: OK, we are clear about what he has been accused of, and we know that he has indeed received a pardon. However, there are still many questions surrounding this pardon. I see many people discussing it privately, expressing opinions on social media, and the media has also written a lot of articles speculating on how this pardon came about. Is it a case of “buying a pardon”? Does it involve corruption? Can you help everyone understand the general process of applying for a pardon first? Then we can discuss the specific criticisms.

Teresa: Of course. Applying for a pardon first requires filling out a formal application and stating the relevant reasons and basis. This application must undergo review by multiple departments, including the Department of Justice, the Office of Pardon Attorney, the White House Counsel's Office, and others. Therefore, before a pardon is granted, there will be a significant amount of legal review work. This is a relatively standardized process, and each application must go through these procedures.

Anthony: After submitting the application, who will receive it? Is there a dedicated “Pardon Office”? Or is there someone responsible for receiving it? Will these applications be sent directly to the President? I imagine the President wouldn't personally go through hundreds or thousands of applications, right? What does this process look like?

Teresa: There are many ways to submit for a pardon, depending on how the applicant submits it. Some submit through specialized pardon lawyers, while others submit through the Department of Justice website or other channels, all aiming to ensure that the review personnel receive it. I know that different people have submitted applications through different methods. However, to my knowledge, the president himself does not initially receive these applications directly.

Anthony: Understood. I want to dig a little deeper. After the application is submitted, will there be relevant personnel who evaluate it and make recommendations to the president? For example, will they say that this case should consider a pardon, or directly recommend a pardon? In other words, is this ultimately a decision made solely by the president, or is there a process in place with recommendations from staff, administrative agencies, or the Department of Justice?

Teresa: I'm not sure how the internal workings of the White House operate specifically, but there are certain definite steps that must be followed. For example, the White House Counsel's Office needs to sign off, and the pardon attorney also needs to sign. Of course, the final decision rests with the president, who also needs to sign the documents. So, this is a collaborative process involving multiple parties. However, I did not participate in those meetings and was not present at those discussions, so I do not have more specific information to share.

Dissecting the conspiracy theory of “benefit exchange behind the special pardon”

Anthony: If there are some people present who are critical of the pardons, they might raise some key questions. For instance, between CZ, Binance, World Liberty Financial, and Trump, there seems to be a sense of confusion in the information, and some may think there’s some sort of “paying for pardons” behavior involved. If we look at these accusations from a more radical perspective, can you elaborate on how you respond to these doubts? I think everyone has heard these voices, and I don't need to repeat them. How do you think people should view the relationship between business transactions and pardons?

Teresa: Yes, these statements are essentially a pile of numerous false assertions, misconceptions, and assumptions. If you wish to view it charitably, it may be a misunderstanding; but many times, these are indeed incorrect statements that are continuously repeated and spread, eventually accumulating into a seemingly “credible” public opinion. I think when you read these accusations, you can try to consider: Do these statements have any actual basis? Have they been verified? You will find that many times, a media report cites another media report, without any substantial evidence, just phrases like “a source close to the matter revealed” — this often means that this source is not reliable.

For example, some media have claimed that World Liberty is Trump's company, but I haven't seen any solid evidence to support this. I checked the official website, which only indicated an “Emeritus” status, and I've also seen some reports suggesting that a certain entity of Trump's may hold a small equity stake, but these hardly amount to “this company is Trump's.” Nevertheless, many people have taken this assumption as fact and then inferred the so-called chain of “interest exchange” based on that.

For example, some people say that the stablecoin USD1 issued by World Liberty is deployed on the Binance Chain, and thus conclude that there is a special relationship between Binance and World Liberty. But this is a complete misunderstanding of the logic of how Blockchain operates. Blockchain is public, and anyone can issue tokens on it, just like posting information on Craigslist does not mean you have any private connection with the former CEO of Craigslist. This conclusion has no logical basis.

Additionally, some people mentioned that trading between Binance and MGX was conducted via USD1, claiming that this was CZ sending money to Trump in this way. This also shows that they completely misunderstand the mechanism and business logic of stablecoins. It’s like saying that if you buy something from me and pay in Swiss Francs, it leads to the conclusion that I am investing in Swiss Francs, or even bribing Swiss politicians. Such statements are completely illogical and are as absurd as the current accusations against CZ.

I think that people who understand this industry know these accusations are ridiculous, so they won't put much effort into refuting them. However, those who are not familiar with the industry will repeatedly spread these claims, and over time, these rumors will snowball and grow larger. What we are seeing now is exactly that.

Other exchange executives have also been granted clemency: not just a CZ exception.

Anthony: I feel that you are a very excellent lawyer. I once wanted to be a lawyer too, but I just wasn't smart enough. However, I want to “challenge” you here –– is USD1 also on other chains, and not just deployed on the Binance Chain?

Teresa: You are actually very smart. That's right, USD1 is indeed deployed on other chains. This is actually another key point; other exchanges also hold it. If you really want to infer a special relationship between Binance and certain political figures just because it is on the Binance chain, shouldn't we also say that other exchanges holding this stablecoin are involved in something as well? But in fact, nobody accuses other platforms like this, only Binance, which is unfair.

Anthony: Were there any other crypto exchange CEOs who also received pardons during the Trump administration?

Teresa: Yes, I remember that Arthur Hayes was granted clemency; he is the former CEO of BitMEX. I recall that BitMEX itself also received relevant treatment. In fact, the mechanism of clemency for individuals and companies has existed since the founding of the United States, even tracing back to the period of England. It applies not only to criminal cases but also to civil cases involving individuals or entities. This has been around for a long time, but in recent years, clemency has focused more on criminal cases and individuals. Additionally, Ross Ulbricht from the Silk Road case has also received clemency.

Anthony: So actually there are many people who have been granted pardons, this is not just a case of CZ, right?

Teresa: Exactly right. It's not just CZ who received the pardon.

Anthony: Well, if we return to the critics' perspective, they might still say that there is “smoke and mirrors” here, and “where there’s smoke, there’s often fire.” They might ask: Does Trump actually have a hidden Bitcoin wallet, and did CZ or Binance secretly transfer money to him? Are there any transactions that haven’t been disclosed yet but could come to light in the future? What do you think about this more conspiracy theory-like assertion?

Teresa: I know CZ very well, and I can say with certainty that such a thing will never happen. It is completely not his style. Although I do not know the president personally, of course I would love to meet him, but from what I know about him, I cannot imagine him doing something like this.

Refuting allegations such as “secret Bitcoin wallets”

Anthony: I don't know if he has a Bitcoin wallet, but if he does, I would be quite surprised.

Teresa: You know, all transactions can be traced now. If there really were such “secret transactions,” they would have been discovered long ago. We must have seen such information in some credible and verifiable reports. This is also the charm of Blockchain technology - it has a high level of transparency. So I can clearly say that nothing like that has happened.

Anthony: I understand. So when we look at these external criticisms, most of them are actually trying to force some kind of “indirect benefit” or “covert transaction” onto this pardon process. But through this conversation, I learned that the pardon is not solely decided by the president; there are many people involved in the approval process. Moreover, even if something did happen as they say, like a payment of USD1, the issue is that such transactions also occur on other chains and are used by other people, not unique to Binance. So these people are just picking one from a pile of normal cases, trying to fabricate a story.

Teresa: Yes, you can think of it the other way around — if Binance said “You are not allowed to issue USD1 on our chain, and you cannot use it to purchase rights,” how could such a restriction be reasonable for a cryptocurrency trading platform? So by reversing this logic, it becomes clearer how absurd these accusations are.

Anthony: I have known CZ for many years and have always thought of him as a calm, steady, and kind person. Going through these events is really not easy. Earlier this year, I even interviewed him, and he mentioned that he came from a small village without electricity or running water, and later became one of the richest people in the world. After such a huge turning point, I can't imagine how he has managed to cope. How has he faced these challenges? I think in this public opinion and political storm, it is easy for everyone to overlook his human side – he has a family, and he has emotions. He has also been to jail, and this whole process must have had a lot of ups and downs.

Teresa: Yes, this is also what I particularly admire about him. As his lawyer, I sometimes get more emotionally volatile than he does. But he always remains very calm and unhurried, able to face everything with composure. I am an optimist, but his level of optimism far exceeds that of ordinary people; he always manages to see the positive side of things. I really admire him, and I can't think of anyone else who can handle everything like he does — so calmly, gratefully, and persistently.

You just spoke very well. Sometimes I watch him being misunderstood and attacked by false reports, and I feel really angry because I know that those contents are completely wrong. And everyone seems to forget that he is a real person, someone with a family. So we should always remember that no matter who you are attacking, blaming, or preventing from fighting for their rights, behind it all is a person, a person with a family and emotions, and they should not have to endure this.

Elizabeth Warren's social media clash with CZ

Anthony: I was hoping you could spill some tea, like when CZ lost control and got angry or something. He looks good, is very wealthy, and always seems to have everything under control.

I’m actually quite jealous; I was hoping you could dig out some of his little flaws. By the way, I saw a piece of news online before, and I had to read it twice to confirm it wasn’t AI-generated or some edited photo: Elizabeth Warren came out and made a bunch of statements, fiercely criticizing CZ and this pardon incident. Of course, it’s common for both parties to attack each other, but later I saw it seemed to be you, or CZ responded saying her statements were inaccurate. After that, Warren replied again, and it became quite dramatic, turning into a back-and-forth “soap opera.” Can you help us clarify the whole story? Is it common for politicians to actively intervene and make public statements like this? What exactly did she say at that time?

Teresa: She posted on social media saying that CZ has been convicted of a certain crime, but in fact, he has not been convicted at all. She also claimed that he obtained a pardon through a so-called “paying for clemency” method, implying that he did something improper during the application process, which further imposed a non-existent criminal liability on him, and all of this is inaccurate.

You cannot casually make such accusations against a person, claiming that they have committed a crime, especially without any factual basis. Regardless of who you are, this behavior is irresponsible. Of course, there are indeed some exemptions that apply to government officials or individuals in specific positions, but these exemptions are not applicable in all cases.

I actually hope that everyone can pay more attention to this issue. The immunity from speech enjoyed by certain politicians today is not what the Founding Fathers of the United States intended. If you read early constitutional documents, such as the “Speech or Debate Clause”, you will see the true concerns of the founders at that time. They were worried that the speech of politicians could have a huge impact on the lives, reputations, and even livelihoods of ordinary people, yet they would not bear legal responsibility for it. Joseph Story made this very clear in his “Commentaries on the Constitution of the United States”. I think the event we are discussing today precisely touches on the core of the concerns they originally had.

The “Pendulum Fluctuation” of Crypto Regulation and Future Hope

Anthony: Looking back at the whole event, I think it is essentially related to the politicization and regulation of cryptocurrency. The crackdowns and suppressions we have seen in the past few years are obviously products of the political backdrop. The new government currently takes a completely different path. Many investors, market participants, and even some politicians are excited about the revival of U.S. crypto innovation. But this political inclination seems a bit like a pendulum, swinging from one extreme to another. Do you think this back-and-forth motion will continue? Should the industry expect many fluctuations in the future? Or once the policies enter a chasing-the-wind state, will it be difficult to go back to a harsh crackdown on the industry?

Teresa: I certainly hope this pendulum does not continue to swing back and forth so violently. I believe that the U.S. has finally reactivated some of its innovation momentum, which is a very critical moment. For example, former SEC Chairman Paul Atkins has clearly stated that he hopes all of our markets can be on the blockchain. And once financial markets are truly on the chain, it will be very difficult to pull them back.

This is a revolutionary technology that we should not try to evade or suppress, but rather embrace. It can bring significant efficiency improvements and scale advantages. I believe that the current environment provides a valuable opportunity for people to better understand Blockchain technology, not just in the financial services sector, but in other scenarios as well. Once society truly accepts this technology, it will be very difficult to revert back to the old technological system.

CZ does not return to Binance, and the US misses out on the cryptocurrency market dividend.

Anthony: So what changes have occurred at Binance now? After reaching a settlement with CZ and receiving a pardon, will he return to Binance? Has Binance made any adjustments to its business? How much do you know about these? What is the current situation at Binance?

Teresa: He currently has no plans to return to Binance. Moreover, Binance is still under multiple restrictions from five U.S. regulatory agencies, including the Department of Justice (DOJ), the Commodity Futures Trading Commission (CFTC), the Financial Crimes Enforcement Network (FinCEN), and the Office of Foreign Assets Control (OFAC). It is important to note that most companies might only be targeted by one or two agencies, while Binance is being regulated by five departments simultaneously, even though no fraud or other significant illegal activities have been found.

Binance is currently still in a “monitoring state”; the Treasury Department has appointed a supervisor through FinCEN to ensure that Binance complies with U.S. laws, even though they have been “deported” and have no U.S. customers. Logically, such a company should no longer be required to comply with U.S. regulations, but they are still under continuous supervision.

Of course, everyone is happy that CZ can clear his name, but the whole process has had a very profound impact on him personally and on Binance. And I believe the real victim here is actually the United States. Because Binance is still unable to operate in the United States, the world's largest cryptocurrency exchange is not here, which means we lose the liquidity advantage it brings.

This raises several issues: first, to become the largest market globally, you need sufficient liquidity; second, users want options and the ability to participate in different types of tokens and projects; third, new projects also wish to launch on the largest platform, which is not based in the United States. This has led many projects to choose to launch overseas, just to be able to list on Binance.

In addition, the lack of competitors like Binance has weakened the global competitiveness of domestic platforms in the United States. Ultimately, this is a loss for the entire crypto ecosystem in the US.