Changpeng Zhao's Revelation: The 'Shadow War' Among Crypto Exchanges for U.S. Market Dominance

On May 10, 2026, Binance co-founder Changpeng Zhao (CZ) reignited intense controversy within the digital asset industry. He claimed that his presidential pardon process was nearly derailed by a multi-million dollar lobbying campaign from rival exchanges. These remarks, coming months after his pardon, suggest that the battle for dominance in the U.S. cryptocurrency market has been fiercely fought at the core of power, beyond just trading volume.

"Rivals were afraid of Binance re-entering the U.S. market. They poured millions of dollars into lobbying to keep me in prison."

In his May 10, 2026, announcement, Zhao emphasized that rival exchanges moved systematically to block Binance's potential re-entry into the U.S. market. He criticized these firms for using his legal issues as a tool to gain a competitive advantage. His core claim is that major U.S.-based exchanges mobilized lobbying funds to pressure political circles.

October 2025: Surprise Presidential Pardon and Background

The incident dates back to October 23, 2025. At that time, President Donald Trump granted a surprise pardon to Changpeng Zhao, who had been convicted of violating anti-money laundering laws. Federal prosecutors had previously sought a three-year prison sentence, noting that Zhao and Binance had put the U.S. financial system and national security at unprecedented risk, but the situation took a sharp turn with the exercise of presidential pardon power.

• October 28, 2025: The Senate Banking Committee sent a letter to the Department of Justice and the Treasury Department inquiring about the details of the pardon.
• November 6, 2025: 27 House Democrats issued a statement strongly condemning the presidential pardon.
• The Senate Banking Committee reviewed a resolution defining the pardon as a corrupt act and calling for a congressional block.
• The Department of Justice faced additional pressure to investigate Binance's past operations even after the pardon.

It is known that Chess McDowell, head of the lobbying firm 'Checkmate Government Relations,' was deeply involved in Zhao's pardon process. McDowell is categorized as a close associate of Donald Trump Jr., and analysis suggests his lobbying activities played a decisive role in the pardon decision. Conversely, Zhao argues that these lobbying activities were essential measures to achieve justice by breaking through the obstruction of rivals.

Market analysts believe the reason U.S. rivals like Coinbase and Kraken were wary of Zhao's legal freedom is clear. If Binance breaks through regulatory barriers and officially returns to the U.S. market, the market share of existing firms will inevitably be significantly threatened. Thus, the interpretation that the attempt to block Zhao's pardon was a strategic choice to protect market share, rather than a simple pursuit of legal justice, is gaining traction.

Political Controversy and Clarification in Davos

Regarding allegations of business ties with the Trump family that surfaced after the pardon, Zhao took a firm stance. In an interview at the World Economic Forum (WEF) in Davos, Switzerland, on January 23, 2026, he denied having any business relationship with the Trump family. He claimed his pardon was not the result of a financial transaction and that political misunderstandings must be corrected.

However, as of May 2026, the view from U.S. political circles remains unfavorable. In particular, Democratic lawmakers criticize Zhao's pardon as an example of the negative influence of the crypto industry's massive financial power on political decision-making. Congress is not letting up on its oversight, demanding the submission of related documents and communication records to ensure transparency in the pardon process.

Zhao's latest revelation is also interpreted as a sophisticated PR strategy to seize public opinion ahead of Binance's re-entry into the U.S. market. By positioning himself as a victim of unfair attacks from rivals, he is analyzed to be seeking a favorable position in future negotiations with regulatory authorities. The industry is watching whether Binance can overcome this controversy and obtain an official license in the U.S.

Consequently, the remarks on May 10, 2026, clearly revealed the complex interests facing the cryptocurrency industry. There is a cynical view that an industry that once shouted for technological innovation and the democratization of finance has actually transformed into a field for traditional political lobbying and backroom deals. The battle over the truth surrounding Zhao's pardon is expected to be an important variable in changing the U.S. crypto regulatory landscape.

Currently, Binance appears to be focusing on organizational restructuring and strengthening transparency following the pardon. However, with strong checks from rivals and lingering doubts from political circles, whether the reality of the "lobbying war" claimed by Zhao will be clearly revealed will be the key to restoring market trust in the future.