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Binance co-founder Changpeng “CZ” Zhao has strongly refuted Bloomberg’s recent allegations linking him to the Trump-backed USD1 stablecoin, threatening legal action over what he calls defamatory reporting.
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The Bloomberg article claimed Binance developed the smart contract for USD1 and suggested Zhao sought a presidential pardon following a major $2 billion deal involving the stablecoin, assertions Zhao categorically denies.
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According to CZ’s statements on X, the report is a “hit piece” riddled with inaccuracies, echoing past disputes with Bloomberg over similar false claims.
Binance co-founder CZ denies Bloomberg’s USD1 stablecoin claims, threatens legal action, and highlights ongoing scrutiny around Trump-linked crypto ventures.
Bloomberg’s Allegations and Binance’s Firm Rebuttal
The recent Bloomberg report alleged that Binance was instrumental in creating the USD1 stablecoin issued by World Liberty Financial (WLF), a company associated with former President Donald Trump. It further claimed that Zhao applied for a presidential pardon shortly after USD1 was utilized in a $2 billion transaction involving a UAE-based investment fund and Binance. The report also noted that over 90% of USD1 tokens remain in Binance wallets, potentially generating substantial interest revenue.
In response, Zhao publicly dismissed these claims as unfounded and defamatory. He described the article as a competitor-sponsored “hit piece” filled with “so many factual errors” that he was unsure where to begin addressing them. This is not the first time Zhao has confronted Bloomberg over similar accusations; in 2022, Bloomberg retracted an article that falsely labeled Binance a Ponzi scheme and issued an apology through its Chinese-language edition.
Legal History and Presidential Pardon Context
Zhao’s legal challenges have been well documented. In 2023, he pled guilty to a felony charge as part of a settlement with U.S. authorities and served four months in prison. Since then, he has publicly pursued a presidential pardon, which could enable him to re-engage in managerial roles within U.S.-based crypto enterprises. This pursuit has drawn attention amid ongoing regulatory scrutiny of Trump’s crypto-related ventures, including WLF and his official memecoin.
Meanwhile, U.S. lawmakers continue to advance legislation targeting the crypto sector. The GENIUS Act, which regulates payment stablecoins, recently passed the Senate with bipartisan support despite initial opposition linked to concerns over Trump’s crypto interests. These developments underscore the complex regulatory environment surrounding stablecoins and major crypto players like Binance.
Ongoing Media Conflicts: Zhao’s Disputes with Bloomberg and WSJ
Beyond Bloomberg, Zhao has also publicly challenged reports from other major outlets. In April, he refuted a Wall Street Journal article alleging that he agreed to cooperate with U.S. authorities against Tron founder Justin Sun as part of a plea deal. Zhao emphasized that government witnesses typically avoid prison time, implying that such claims were misleading and possibly motivated by smear campaigns.
These media disputes highlight the contentious relationship between Zhao and certain financial news organizations, reflecting broader tensions within the crypto industry regarding transparency, legal accountability, and media representation.
Implications for Binance and the Crypto Industry
The allegations and subsequent denials have significant implications for Binance’s reputation and regulatory standing. As one of the largest cryptocurrency exchanges globally, Binance’s involvement with stablecoins linked to politically sensitive figures adds layers of complexity to its compliance and public perception. The ongoing legal and legislative scrutiny emphasizes the need for clear regulatory frameworks and transparent corporate governance within the crypto ecosystem.
For investors and industry observers, these developments serve as a reminder to critically evaluate media reports and seek verified information amid a landscape often marked by competing narratives and regulatory uncertainty.
Conclusion
Changpeng Zhao’s firm rejection of Bloomberg’s USD1 stablecoin allegations and his readiness to pursue legal remedies underscore the high stakes involved in crypto media coverage and regulatory scrutiny. As U.S. lawmakers advance stablecoin regulations and Binance navigates ongoing legal challenges, the crypto industry remains at a pivotal juncture where transparency, compliance, and accurate reporting are essential for sustainable growth.
