--:-- [Theme music fades out]
--:-- Host (Ryan Knutson): Welcome to The Journal, our show about money, business and power. I'm Ryan Knutson.
--:-- Guest (Jessica Mendoza): And I'm Jessica Mendoza.
--:-- Host (Ryan Knutson): It's Thursday, March 13th. Today, we're talking about President Trump's crypto agenda and a potential deal between the Trump family and Binance.
--:-- Guest (Jessica Mendoza): That's right. President Trump has made crypto a big part of his agenda. He's even called himself the crypto president. And last year, I promised to make America the Bitcoin superpower of the world and the crypto capital of the planet. And we're taking historic action to deliver on that promise.
--:-- Host (Ryan Knutson): And today, the Wall Street Journal came out with a big scoop on a potential deal between the Trump family and a crypto giant. Our reporting shows that representatives of Trump's family have held talks to take a financial stake in the U.S. arm of Binance, which is a crypto exchange that in 2023 pleaded guilty and paid a pretty massive fine after it was accused of violating anti-money laundering requirements.
--:-- Guest (Rebecca Ballhaus): That's right. According to my reporting, not only is the Trump family in talks about a stake in Binance, but the founder of Binance, a convicted felon, is also asking for a presidential pardon.
--:-- Host (Ryan Knutson): And so the fact of someone, you know, pushing for an official government action from the president at the same time as a company is in talks with the president's family or representatives of the president's family is just a pretty striking mixture between official and personal business.
--:-- Guest (Rebecca Ballhaus): In an ordinary administration, the family of a president pursuing a business deal like this, particularly in an industry that the president is actively making rules for and sort of doing things that the industry has long wanted, would in any ordinary administration be the enormous scandal.
--:-- Host (Ryan Knutson): In this administration, I would say, you know, the Trump organization has been pretty upfront about the fact that they're not going to stop pursuing business deals. But I think the really shocking thing is just this sort of idea of pursuing a business deal as a pardon is also being sought.
--:-- Guest (Rebecca Ballhaus): It certainly creates the appearance of a conflict, even if it's not an exchange of one for the other.
--:-- Host (Ryan Knutson): Welcome to The Journal, our show about money, business and power. I'm Ryan Knutson.
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--:-- Host (Ryan Knutson): What is Binance and who founded it?
--:-- Guest (Rebecca Ballhaus): Binance is a crypto exchange that for years was sort of one of the major exchanges. It was founded by Changpeng Zhao, CZ, as he's known, in 2017 in Shanghai.
--:-- Host (Ryan Knutson): And for years, it was really sort of on the rise, growing incredibly quickly, and was really one of the main competitors in this space.
--:-- Guest (Rebecca Ballhaus): As it grew, Binance came under scrutiny from federal regulators. In response, CZ set up a separate U.S. exchange for American clients to try to allay the regulatory concerns.
--:-- Host (Ryan Knutson): But then, in 2023, Binance reached a deal with the Justice Department over a sweeping criminal investigation.
--:-- Guest (Rebecca Ballhaus): We do have some breaking news on a major crypto company, Binance. The CEO, Chang Peng Zhao, is pleading guilty to federal charges. Including the use of cryptocurrency exchanges to support groups such as Hamas.
--:-- Host (Ryan Knutson): Binance founder, CZ, sentenced to four months in prison.
--:-- Guest (Rebecca Ballhaus): The Department of Justice says that his company, Binance, failed to prevent money laundering. Binance agreed to settle the investigation and to pay a $4.3 billion fine.
--:-- Host (Ryan Knutson): And its founder CZ So as part of the settlement Zhao stepped down as CEO but he remained the majority shareholder
--:-- Guest (Rebecca Ballhaus): And last year he was sentenced to four months in prison He was released in September, and he's now living in Abu Dhabi.
--:-- Host (Ryan Knutson): In 2023, the crypto industry was in hard times. Popular exchange FTX had collapsed, and its owner, Sam Bankman-Fried, was convicted of fraud.
--:-- Guest (Rebecca Ballhaus): Federal investigators were cracking down on crypto companies. But now, in 2025, crypto is on an upswing. A few months ago, Bitcoin hit an all-time high of $100,000.
--:-- Host (Ryan Knutson): Many investors point to Trump's re-election as a good sign for the industry.
--:-- Guest (Rebecca Ballhaus): But Binance is currently missing out.
--:-- Host (Ryan Knutson): When did Binance start thinking it could potentially reenter the U.S. market?
--:-- Guest (Rebecca Ballhaus): So our understanding is that around the time of Trump's election win last fall, Binance began exploring its options for how to return to the U.S. market.
--:-- Host (Ryan Knutson): It began telling people that it was willing to make a deal with Trump's company and that it wanted to eliminate its legal problems in the U.S.
--:-- Guest (Rebecca Ballhaus): And our understanding is that around that time, it began reaching out to allies of Trump sort of offering to strike a business deal with the family as part of this plan to return the company to the U.S.
--:-- Host (Ryan Knutson): Was there a playbook they were following? Like, how did they come up with an idea of what to do?
--:-- Guest (Rebecca Ballhaus): So our understanding is that they got a pretty good idea for a playbook when they saw what happened in November with Justin's son, according to a person familiar with the discussions.
--:-- Host (Ryan Knutson): In November, Justin Sun, who is a China-born crypto entrepreneur who is facing charges from the SEC, invested $30 million in World Liberty Financial, which is a crypto company that is backed by the Trump family and was launched a couple of months before the election.
--:-- Guest (Rebecca Ballhaus): And, you know, for Sun, we saw that last month, the SEC asked a court to pause its fraud case against him.
--:-- Host (Ryan Knutson): And so, you know, it remains to be seen how that will shake out once that 60-day pause is over.
--:-- Guest (Rebecca Ballhaus): And when Binance saw that Sun had made this investment, they thought, you know, that that could be a route for us to go here.
--:-- Host (Ryan Knutson): And so they began considering making a deal with World Liberty Financial or potentially sort of going the same route of a cash infusion in the company in exchange for a pardon for the founder.
--:-- Guest (Rebecca Ballhaus): So what do finance executives do?
--:-- Host (Ryan Knutson): So we know that sometime after they internally discussed whether they should go this Justin Sun route of investing in World Liberty Financial, these talks about a business deal continue.
--:-- Guest (Rebecca Ballhaus): And at some point here, Steve Whitcoff, who's a longtime friend of Trump, who also co-founded World Liberty Financial, gets involved in these talks.
--:-- Host (Ryan Knutson): Wyckoff is a real estate investor, a lawyer, and is also Trump's top negotiator in the Middle East and for the war in Ukraine.
--:-- Guest (Rebecca Ballhaus): An administration official denied Wyckoff's involvement and said he's in the process of divesting from his business interests.
--:-- Host (Ryan Knutson): World Liberty Financial declined to comment.
--:-- Guest (Rebecca Ballhaus): We don't know the exact tick-tock of how these talks unfolded and when each person got involved, but we do know that they've continued even since Trump's inauguration, as well as the push for a pardon for CZ.
--:-- Host (Ryan Knutson): The reason that CZ is seeking a pardon, given that he's already served, you know, his prison sentence and has been released, is that Binance has wanted for at least several months now to return to the U.S. market.
--:-- Guest (Rebecca Ballhaus): And a pardon would really help him clear the way to do that.
--:-- Host (Ryan Knutson): The other thing a pardon could help with is that it complicates Binance's business in the European Union to have a majority shareholder be a convicted felon.
--:-- Guest (Rebecca Ballhaus): And so were he to be pardoned, it could also sort of ease some hurdles abroad as well.
--:-- Host (Ryan Knutson): Why would this kind of deal be appealing to the Trump family?
--:-- Guest (Rebecca Ballhaus): So it's a great question because you have to think that, you know, this kind of deal, if it became public, would bring a lot of scrutiny that the Trump family and World Liberty Financial might not be interested in.
--:-- Host (Ryan Knutson): At the same time, I think if they did go forward with a stake in this American arm of Binance, and if the Trump family or World Liberty Financial were to have a stake in that, its value is likely to, you know, really increase after returning to the U.S. market.
--:-- Guest (Rebecca Ballhaus): And so for them, it would mean sort of a piece of this pie that is expected to grow if they return to the U.S.
--:-- Host (Ryan Knutson): The Trump Organization and Binance didn't respond to requests for comment.
--:-- Guest (Rebecca Ballhaus): Binance U declined to comment
--:-- Host (Ryan Knutson): In a tweet today CZ said he had not had discussions about this potential deal adding quote no felon would mind a pardon
--:-- Guest (Rebecca Ballhaus): How common is this kind of business deal for a president, but also in the Trump universe?
--:-- Host (Ryan Knutson): Well, you know, it's not unusual for the Trump organization to pursue deals, including foreign deals. They've been pretty open about that.
--:-- Guest (Rebecca Ballhaus): But what is unusual is, you know, pursuing a deal with a company, first of all, that was convicted of a crime, you know, just over a year ago, but also one whose founder is actively asking for something from the administration.
--:-- Host (Ryan Knutson): It certainly fits with a pattern of the Trump family or representatives of the Trump family pursuing a number of different business ventures while Trump has been in office.
--:-- Guest (Rebecca Ballhaus): Coming up, it's not just Binance. How Trump's family has turned his presidency into a cash bonanza.
--:-- Host (Ryan Knutson): We'll be right back.
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--:-- Host (Ryan Knutson): Welcome back to The Journal.
--:-- Guest (Jessica Mendoza): Since Trump was elected, what has the Trump family's financial picture looked like?
--:-- Guest (Rebecca Ballhaus): I would say that since the election, there has been a cash bonanza for the Trump family.
--:-- Host (Ryan Knutson): So we saw this really sort of ramp up during the transition when Amazon had done a $40 million deal to buy a documentary about Melania Trump's return to the White House.
--:-- Guest (Rebecca Ballhaus): And this was a pretty shocking number because it was the most Amazon had ever paid for a documentary.
--:-- Host (Ryan Knutson): And as we reported last month, it was also three times what the next highest bidder had offered for the documentary.
--:-- Guest (Rebecca Ballhaus): So that was one.
--:-- Host (Ryan Knutson): The second is that Trump has been pressing the companies that he sued while he was out of office to now settle their lawsuits that he had brought against them.
--:-- Guest (Rebecca Ballhaus): And he's been pretty successful. We've seen a handful of major settlements that total, I think, about $50 million so far, much of which is going to Trump's presidential library.
--:-- Host (Ryan Knutson): Those settlements have been with companies including ABC News, X and Meta.
--:-- Guest (Rebecca Ballhaus): Trump's other big financial windfall? Meme coins.
--:-- Host (Ryan Knutson): Earlier this year, he launched one name for himself. And the First Lady launched her own, too.
--:-- Guest (Rebecca Ballhaus): And then we've seen this meme coin that Trump launched in the days before his inauguration that has already collected hundreds of millions of dollars in trading and other fees that go to entities affiliated with Trump.
--:-- Host (Ryan Knutson): What has Trump said about these meme coins?
--:-- Guest (Rebecca Ballhaus): So one thing we heard was that just a couple of weeks ago at Mar-a-Lago, at a private fundraiser for donors who had paid a billion dollars to be there, he was kind of marveling at the ability of a coin like that to bring in potentially billions of dollars.
--:-- Host (Ryan Knutson): And he actually went around the audience and asked whether they knew what his coin was worth.
--:-- Guest (Rebecca Ballhaus): And the answer he got was that the total market cap at the time was about $13 billion.
--:-- Host (Ryan Knutson): But so, you know, it's clear that Trump is paying attention to these things.
--:-- Guest (Rebecca Ballhaus): Trump didn't always pay attention to crypto. Just a few years ago, he said it was a disaster waiting to happen.
--:-- Host (Ryan Knutson): And then we really saw him sharply turn during the campaign, and especially in 2024, towards the industry.
--:-- Guest (Rebecca Ballhaus): And he started calling himself the crypto president.
--:-- Host (Ryan Knutson): But I think there were a couple of factors at play.
--:-- Guest (Rebecca Ballhaus): The first is that I think he saw the potential for fundraising from that industry.
--:-- Host (Ryan Knutson): We know that between his election and his inauguration he brought in something like $100 million from the industry for his inaugural fund and other committees
--:-- Guest (Rebecca Ballhaus): And I think he likes the idea of sort of returning the crypto industry to the U.S. and making the U.S., as he has said, the crypto capital of the world.
--:-- Host (Ryan Knutson): Trump's administration has rolled back some regulatory threats to the crypto industry.
--:-- Guest (Rebecca Ballhaus): He's signed executive orders regarding crypto, hosted crypto leaders at the White House.
--:-- Host (Ryan Knutson): And last week, Trump established a strategic Bitcoin reserve.
--:-- Guest (Rebecca Ballhaus): And then the SEC, you know, which Trump doesn't directly control, but, you know, he certainly appointed regulators who are friendly to the crypto industry.
--:-- Host (Ryan Knutson): We've seen them drop or pause a dozen lawsuits against crypto companies so far.
--:-- Guest (Rebecca Ballhaus): So, you know, he'd be getting a stake in a crypto company at a time where crypto is thriving in the U.S.
--:-- Host (Ryan Knutson): And this cash bonanza that we're talking about, the deals from the Melania documentary to the settlements to the meme coins, have these raised any concerns or criticism?
--:-- Guest (Rebecca Ballhaus): Yes, I think it is safe to say that there has been a lot of criticism of his avid pursuit of business deals while in office.
--:-- Host (Ryan Knutson): But, you know, I think it's also worth noting that the people in the government who would really be in a position to try and do something about this, for example, the head of the Office of Government Ethics, Trump fired soon after becoming president.
--:-- Guest (Rebecca Ballhaus): And he's installed a close ally of his in that job.
--:-- Host (Ryan Knutson): So the number of people within the federal government, or at least within the executive branch, who have the standing to kind of speak out about some of these conflicts, there's a pretty small number of those.
--:-- Guest (Rebecca Ballhaus): During Trump's first administration, conflicts of interest were a big concern.
--:-- Host (Ryan Knutson): How differently are he and his family operating now in the second term?
--:-- Guest (Rebecca Ballhaus): So you're right that it was a big issue the first time around. But I would say that this administration is so far the first term kind of on steroids when it comes to this stuff.
--:-- Host (Ryan Knutson): I thought one thing that was really striking was Eric Trump in October, the month before the election, said in an interview with the Journal that sort of the first time around, they tried to do everything right.
--:-- Guest (Rebecca Ballhaus): And he felt they got very little credit for it.
--:-- Host (Ryan Knutson): And the implication was, you know, we're not going to try and necessarily abide by these norms this time around.
--:-- Guest (Rebecca Ballhaus): And are there some guardrails that the White House has put in place?
--:-- Host (Ryan Knutson): I mean, I think it's important to note that the president is just not bound by the same conflict of interest rules as the rest of the federal government is.
--:-- Guest (Rebecca Ballhaus): He doesn't have to abide by these laws that dictate that you have to avoid participating in something that you have a personal stake in.
--:-- Host (Ryan Knutson): I didn't realize that.
--:-- Guest (Rebecca Ballhaus): Yeah, the president does not have the same requirements of what they have to avoid in terms of conflict.
--:-- Host (Ryan Knutson): But most presidents other than Trump have sort of taken that very seriously nonetheless.
--:-- Guest (Rebecca Ballhaus): They typically place their assets in a blind trust.
--:-- Host (Ryan Knutson): They avoid striking new deals while in office.
--:-- Guest (Rebecca Ballhaus): But Trump instead has transferred his assets to the control of his children who have continued to pursue these deals.
--:-- Host (Ryan Knutson): Looking at this potential deal with Binance, is it any different from the other deals that have happened in the Trump orbit?
--:-- Guest (Rebecca Ballhaus): I mean, a number of these deals so far have the potential to have an overlap with the administration's work.
--:-- Host (Ryan Knutson): You know, a settlement with Meta, which is actively seeking a lot from this administration, and whose CEO is meeting with Trump in the White House, there is certainly the potential for overlap there or the expectation of overlap there.
--:-- Guest (Rebecca Ballhaus): I think this just sort of takes it one step further, where you're pursuing a business deal with a, you know, convicted business venture, with a founder who has pleaded guilty just a little over a year ago, who at the same time is looking for a pardon for those charges.
--:-- Host (Ryan Knutson): I just think that that's sort of the most acute intertwining of these things that we've seen so far.
--:-- Guest (Rebecca Ballhaus): That's all for today.
--:-- Host (Ryan Knutson): Thursday, March 13th. The Journal is a co-production of Spotify and The Wall Street Journal.
--:-- Guest (Rebecca Ballhaus): Additional reporting in this episode by Angus Berwick, Josh Dossey, Patricia Kaussman, Annie Linsky, Dana Mattioli, and Caitlin Ostroff.
--:-- Host (Ryan Knutson): Thanks for listening. See you tomorrow.
