Crypto tycoon Changpeng “CZ” Zhao is weighing a libel suit against Trump-hating Democratic Sen. Elizabeth Warren of Massachusetts over a social-media posting that allegedly defamed him over the reasons behind his 2023 plea deal and subsequent jail term, The Post has learned.
Zhao’s prosecution over violations of the Bank Secrecy Act led President Trump to pardon the 48-year-old crypto billionaire last week, stoking a wave of criticism that the move benefits the Trump family as it heavily expands into the digital coin industry.
Warren, a powerful Democrat on the Senate Banking Committee, has been among the staunchest critics of Trump’s crypto business ties and moves by the White House to deregulate the $4 trillion crypto industry.
Immediately after Trump’s pardon of Zhao last Thursday, she posted on X: “CZ pleaded guilty to a criminal money laundering charge and was sentenced to prison. But then he financed President Trump’s stable coin and lobbied for a pardon. Today, he got it. If Congress does not stop this kind of corruption, it owns it.”
But Zhao was never convicted of money laundering, just a violation of the Bank Secrecy Act for failing to maintain proper controls against potential nefarious activities while he was running the massive crypto exchange Binance before his forced resignation as part of the plea deal with the Justice Department.
Through his lawyer Teresa Goody Guillen, he is preparing a letter calling for on Warren to retract the statement, she tells The Post. Without a formal retraction, Goody Guillen said Zhao plans to file a defamation lawsuit imminently against the senator.
“Mr. Zhao will not remain silent while a United States Senator seemingly misuses the office to repeatedly publish defamatory statements that impugn his reputation,” Goody Guillen wrote in a draft letter reviewed by The Post. “Accordingly, Mr. Zhao respectfully immediately requests the retraction of these false statements, both within the resolution and on X… Mr. Zhao reserves his right to pursue all legal remedies available to address these false statements.”
Warren and fellow-Trump hater Sen. Adam Schiff, a California Democrat, have put forward a resolution condemning the pardon and calling on Congress to “use its authority to stop this form of corruption.”
A spokeswoman for Warren had no immediate comment on the possible defamation suit. Just before she was scheduled to introduce the resolution on the Senate floor on Tuesday afternoon, Warren told Fox Business’s Chase Williams that Zhao “plead guilty to violating the law” and she was “calling him out for what he’s plead guilty to.”
Zhao, known in the $3 trillion crypto business as CZ, spent four months in jail, paid a $50 million fine and resigned from the massive crypto exchange for “failing to maintain an effective anti-money laundering program, in violation of the” Bank Secrecy Act, the DOJ stated in a press release announcing the prosecution. The pardon from Trump came last Thursday; as The Post was first to report, the president believed Zhao was a victim of overzealous prosecutors in the Biden Administration’s crackdown on the digital asset industry.
The pardon, however, was not without controversy. Trump has been deregulating the crypto business as his family business has been expanding into digital assets. Warren was among the Democrats attacking the pardon as something that will personally enrich Trump, which the president and reps for Zhao have denied.
People close to CZ maintain that the ties between the Trump family crypto businesses, called World Liberty Financial and CZ’s operations are incidental. Those include outside investors using World Liberty’s stable coin to buy an interest in Binance. Zhao is worth an estimated $80 billion and remains Binance’s largest shareholder.
Warren, they say, has been misrepresenting those relationships and the crimes that landed Zhao in jail. After Warren’s tweet last Thursday, Goody Guillen responded on X that such defamatory statements are a form of protected speech only when spoken on the Senate floor, not in a public space such as social media.
“Worth remembering… the Speech or Debate Clause protects debate/legislative acts—not false and misleading information,” she wrote. “The court held that the Clause does not protect the transmittal of allegedly defamatory material in press releases and newsletters… It likely wouldn’t protect obstructing pardons or justice either. Immunity ≠ Impunity.
“No money laundering charge… none of this is true. I can only explain it to you, but I cannot understand it for you,” she added.
Warren’s initial tweet also drew a community note of “readers added context” from X stating that “CZ pleaded guilty to violating the Bank Secrecy Act for failing to implement an effective anti-money laundering program. He did not plead guilty to money laundering.”
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