Binance co-founder and former CEO Changpeng “CZ” Zhao has stirred controversy by reposting claims on X alleging that Coinbase was the anonymous source behind a Bloomberg report linking Binance to the USD1 stablecoin, a project tied to former President Donald Trump’s World Liberty Financial (WLF). The report, published on July 11, 2025, claimed Binance developed the smart contract for USD1 and suggested Zhao sought a presidential pardon shortly after a $2 billion deal involving a UAE-based fund’s investment in Binance using the stablecoin.
In a post on X, crypto commentator Matt Wallace alleged that Coinbase executives, fearing Binance’s potential re-entry into the U.S. market with a pardon for Zhao, leaked information to Bloomberg to undermine their competitor. Wallace called the move “anti-American,” warning that Binance’s return could threaten Coinbase’s market share. Zhao reposted the claim without confirming or denying it, intensifying speculation about tensions between the two crypto giants.
The Bloomberg report further noted that over 90% of USD1 tokens remain in Binance-controlled wallets, potentially generating tens of millions in annual interest revenue. Zhao dismissed the report as a “hit piece” sponsored by a competitor, citing “factual errors” and hinting at a possible defamation lawsuit against Bloomberg. He referenced a prior dispute where Bloomberg’s Chinese-language edition apologized in July 2024 for falsely accusing Binance of operating a Ponzi scheme.
Coinbase has not yet responded to requests for comment, and neither Binance nor World Liberty Financial has issued an official statement on the allegations. The controversy highlights the fierce competition between Binance and Coinbase, as well as the complex interplay of politics, regulation, and corporate rivalry in the crypto industry. U.S. lawmakers are currently reviewing crypto-related legislation, including the GENIUS Act, which could be influenced by such developments.
