A shocking investigation by Bloomberg alleged that Binance and co-founder Changpeng Zhao supported a stablecoin related to Donald Trump. Named USD1 and issued by World Liberty Financial, this token has sparked considerable controversy. CZ condemned this as a "critical article" and is considering defamation lawsuits. Such a case reflects the increasing tension between political power, financial regulation, and the influence of cryptocurrency.

CZ condemned a "critical article" by Bloomberg

While the SEC has just dropped the lawsuit against CZ, Bloomberg claims that Changpeng Zhao, the former CEO of Binance, was involved in the launch of the USD1 stablecoin related to Donald Trump, in a recent article. This token was issued by World Liberty Financial (WLF), a cryptocurrency company close to the U.S. president.

The article claims that Binance developed the original source code for the smart contract for this stablecoin and that a $2 billion transaction involving an investment fund based in the United Arab Emirates used $1 to invest in Binance.

Bloomberg also suggested that CZ requested President Trump to grant a pardon immediately after this campaign, implying a possible connection between the two events. These revelations have been strongly opposed by CZ, who reacted on X, condemning the article as "containing too many factual errors" to the point that he "doesn't even know where to start," adding: "I might have to sue them again for defamation."

The factors reported extensively by Bloomberg have significant potential. According to the article:

  • Binance is said to have written a smart contract worth $1, putting the company at the center of its technology structure.

  • More than 90% of USD1 tokens are still held in wallets controlled by Binance, generating annual passive revenue of tens of millions of dollars according to Bloomberg.

  • A $2 billion transaction from the UAE's national investment fund was made through USD1, just weeks before CZ made his pardon request to the president.

  • Bloomberg did not provide direct evidence showing Trump's involvement in this transaction but hinted at a potential political connection through WLF.

The article, despite being suggestive, does not cite official sources to verify CZ's direct involvement in these activities. For its part, Binance has yet to make any official statement at this time, forcing CZ to defend his position on social media.

The current case is part of a series of legal disputes between CZ and several major Western media outlets over the past few years. In July 2024, Bloomberg Businessweek (Chinese version) officially apologized after publishing an article accusing Binance of being a Ponzi scheme in 2022.

The media acknowledges that their headline is "false and unfounded," and has chosen to donate to charity instead of compensating for damages. In a recent publication, CZ reiterated this incident by sharing a link to the official retraction. He now seems determined to systematically defend his image against what he perceives as misinformation campaigns.

Furthermore, the Wall Street Journal stated in April that CZ agreed to provide evidence against Justin Sun, the founder of Tron, as part of a deal with the U.S. Department of Justice.

Once again, CZ firmly denied this on X, stating that "those who become government witnesses will not go to jail," while adding that he had heard rumors that WSJ employees were paid to defame him.

Through these episodes, an extremely conflicted relationship emerges between CZ and some American media outlets, marked by mutual suspicion and accusations of manipulation.

In the long run, this new controversy could have significant implications for regulators' and the public's perception of Binance, at a time when the legal framework surrounding stablecoins is changing in the United States. Congress is currently discussing the GENIUS Act, a bipartisan proposal to regulate stablecoins, and this may be affected by such controversies.