Binance named Yi He co-CEO as Donald Trump’s pardon of Changpeng Zhao raises new uncertainty over how strictly US authorities can enforce his three-year management ban.
Summary
- Zhao pleaded guilty in 2023, agreeing to step down as CEO and remain outside Binance’s global management during a three-year U.S. monitorship.
- Yi He, Zhao’s partner and co-manager of YZi Labs’ family office, now shares the top role at an exchange he still majority owns.
- Legal experts are divided over whether the presidential pardon weakens the influence of the DOJ and the Treasury Department or leaves Zhao’s permission to forego executive duties intact.
Binance has appointed Yi He as co-CEO of the cryptocurrency exchange, raising questions about the continued influence of founder Changpeng Zhao, who agreed to step down from management as part of a 2023 plea deal.
Zhao, better known as CZ, pleaded guilty to a federal crime in 2023 and agreed to step down as CEO of Binance. The agreement included refraining from participating in Binance’s global management during a three-year government oversight, court documents show.
Changpeng Zhao may be back at Binance sooner or later
Yi He is the mother of Zhao’s children and co-manages the assets of his family office, YZi Labs. The name YZi is a stylized combination of “Yi,” her first name, and “Z,” the first character of Zhao’s surname, according to public information about the family office.
Bloomberg estimates that Zhao owns approximately 90% of Binance, in addition to an 86% stake in its US subsidiary. Zhao continues to reference Binance in his social media profile and username.
The enforceability of Zhao’s agreement to step away from managing Binance has become uncertain following a presidential pardon he received. The pardon expunged his federal criminal conviction and restored civil rights affected by his federal felony conviction, legal experts said.
Legal commentators have offered differing opinions on the impact of the pardon. Some have argued that the pardon could undermine the ability of the Justice Department and U.S. Treasury Department to enforce their monitorship program, while others argue that Zhao’s authorization to forgo executive functions could remain valid unless explicitly vacated in a separate White House action.
Binance has been actively negotiating with the DOJ to end the monitorship program early, according to sources familiar with the matter. The DOJ and Binance declined to comment on the status of those negotiations.
