US Lawmaker Pushes First-Ever Crypto Ban for Lawmakers

U.S. Representative Ro Khanna (D-Calif.) is moving to introduce landmark legislation that could make it illegal for members of Congress to own, trade, or launch cryptocurrencies — a first-of-its-kind move that may reshape the relationship between Washington and the digital asset industry.

The proposal follows President Donald Trump’s controversial pardon of Binance founder Changpeng “CZ” Zhao, which Khanna called a “blatant act of corruption.” Speaking on MSNBC’s Morning Joe, Khanna accused Trump of striking a “dirty deal” with Zhao, suggesting that the former president granted clemency in exchange for crypto-linked financial support.

Khanna said the bill aims to “draw a clear line between politics and crypto,” arguing that elected officials shouldn’t profit from assets they help regulate. “This isn’t about technology — it’s about integrity,” he said.

A Bid to Close Crypto Conflicts of Interest

The legislation expands on Khanna’s earlier Ban Congressional Stock Trading Act from 2023, which sought to prohibit lawmakers from trading individual equities. The new bill applies the same conflict-of-interest logic to digital assets, requiring lawmakers to divest their crypto holdings or place them in blind trusts.

If passed, it would become the first federal law explicitly banning lawmakers from holding or trading cryptocurrencies — a move Khanna believes is critical for restoring public trust amid growing skepticism about political influence in crypto policy.

Several sitting members of Congress, across both parties, have disclosed investments in Bitcoin, Ethereum, and DeFi tokens, raising questions about impartiality in shaping digital asset regulation.

CZ’s Pardon Sparks Political Backlash

Khanna’s push comes in the wake of Trump’s decision to pardon Changpeng Zhao, who pleaded guilty last year to anti–money laundering violations as part of Binance’s $4.3 billion settlement with the U.S. Department of Justice.

Zhao served just four months in prison, but the pardon cleared his record and restored his ability to take part in Binance’s business operations. The move drew sharp criticism from Democrats and ethics watchdogs, who accused Trump of prioritizing personal and political gain over legal accountability.

Khanna called the pardon “a dangerous precedent,” arguing it underscored the need for stricter ethical boundaries around lawmakers and their financial interests.

Following the pardon, Binance is reportedly exploring ways to re-enter the U.S. market, according to Bloomberg. The company is considering merging its American subsidiary with its global exchange or allowing its main platform to serve U.S. customers directly.

The exchange’s renewed ambitions align with reports of a $2 billion partnership between Binance and Trump’s family-backed venture, World Liberty Finance — a deal that critics say deepens the intersection of political power and crypto money.

Zhao, whose net worth now exceeds $61 billion, remains one of the most influential figures in global crypto, controlling an ecosystem with roughly $8.7 billion in on-chain assets.

Can Crypto and Politics Truly Be Separated?

Khanna’s bill represents a bold attempt to define ethical boundaries in a space where political influence and digital finance increasingly collide. If successful, it could mark a new era of transparency in Washington — one that limits lawmakers’ exposure to the same assets they’re tasked with regulating.

Still, questions remain over whether such a law can truly separate financial innovation from political ambition. Even without direct ownership, crypto’s influence continues to flow through lobbying, campaign donations, and private-sector partnerships.

As Khanna pushes to codify this divide, the broader challenge persists: can any legislation fully keep money — whether fiat or digital — out of politics?