The former CEO of Binance, Changpeng Zhao, has reportedly agreed to assist prosecutors in building a case against Justin Sun, the founder of Tron. This exclusive report cited anonymous sources familiar with the matter and stated that as part of Zhao’s plea deal, he agreed to give evidence on Sun to prosecutors. Prior to the report’s publication, Zhao discredited it as a “hit piece” and claimed that he had not agreed to inform on Sun.
Zhao pleaded guilty to violating anti-money laundering laws and resigned from his position as CEO of Binance, agreeing to pay a $50 million fine and being barred from involvement with the exchange for three years. After serving a four-month sentence, he maintains that his prison sentence proves he did not agree to inform on Sun, as “people who become government witnesses don’t go to prison.” However, individuals can still be prosecuted if prosecutors obtain evidence of their crimes independently.
Last month, the Wall Street Journal published a report claiming that Zhao was trying to obtain a pardon from U.S. President Donald J. Trump for his guilty plea and that representatives of the Trump family were in talks to invest in Binance’s U.S. arm. Zhao denied these claims, stating that while no convicted felon would “mind a pardon,” he had not had any discussions about it. Despite his denial, the WSJ doubled down on its claims about Binance negotiating with the Trump family for a possible deal and trying to loosen the reigns of its compliance monitor.
Justin Sun, in response to the rumors circulating about the plea deal arrangement between Zhao and prosecutors, said that Zhao is both his mentor and a close friend. Sun noted that Zhao has played a crucial role in supporting him during his entrepreneurial journey, and Sun strives to follow Zhao’s conduct and principles as a founder. The U.S. Securities and Exchange Commission (SEC) charged Sun and his companies for violating securities laws and engaging in fraud in March 2023, alleging that the sale of TRON and BitTorrent tokens constituted unregistered securities offerings.
Despite the SEC’s allegations against Sun, on Feb. 26, Sun and the SEC jointly filed a request to pause the legal battle to allow for settlement negotiations. Sun’s legal team believed that the negotiations could lead to a resolution without further litigation. Referring to the rumors and reports in a separate post, Sun emphasized the importance of unity and standing together to “change everything.” It remains to be seen how the legal battles and settlement negotiations between Sun, Zhao, and the SEC will unfold in the coming months.
