Trump-Linked Stablecoin Under Attack by Bloomberg, Potential Lawsuit in Response?
In a recent turn of events, Binance co-founder Changpeng "CZ" Zhao has threatened to sue Bloomberg for defamation over a report linking him and Binance to the creation of a stablecoin, USD1, issued by World Liberty Financial (WLF), an entity tied to former US President Donald Trump. The report, published on July 11, 2025, alleges that Binance helped design USD1’s smart contract, which was involved in a $2 billion investment deal, and that CZ sought a presidential pardon from Trump shortly after the transaction [1][2].
CZ has vehemently denied all claims, characterizing Bloomberg’s article as a “hit piece” full of “factual errors” and hinting that he “might have to sue them again,” referencing a previous legal dispute that ended in a Bloomberg apology and donation in 2024 [1][2]. However, as of mid-July 2025, there is no formal active legal proceeding publicly confirmed regarding this defamation lawsuit [1][2][3].
The alleged use of USD1 in a $2 billion deal with Binance has sparked investigations into whether digital assets are being used to navigate or influence regulatory oversight [4]. Meanwhile, Trump's crypto interests have been expanding rapidly in recent months, including an official memecoin promoted by his campaign backers, crypto-donor fundraising events, and multiple statements signaling strong support for Bitcoin mining and stablecoin innovation in the US [5].
This is not the first time CZ has had disputes with U.S. media outlets. In April 2025, he dismissed a Wall Street Journal report as an attempt to smear him, and in 2022, Bloomberg Businessweek's Chinese-language edition published a now-retracted story alleging Binance was operating a Ponzi scheme [6]. CZ has also sparred with other media outlets, dismissing a Wall Street Journal report claiming he agreed to testify against Justin Sun, founder of TRON, as part of a plea deal with U.S. authorities [7].
It is important to note that CZ served a four-month prison sentence earlier this year after pleading guilty to a felony in late 2023 as part of a $4.3 billion settlement with the U.S. Department of Justice [8]. In 2024, the outlet issued a formal apology and retracted the piece, admitting the headline was "false and baseless" [9].
In summary, the legal status is that of a threatened defamation lawsuit without formal initiation or court filings confirmed to date. CZ is publicly disputing Bloomberg’s report and threatening legal action, but no active case is reported in the search results as of July 2025 [1][2][3].
References: [1] https://www.bloomberg.com/news/articles/2025-07-11/binance-co-founder-threatens-to-sue-bloomberg-over-stablecoin-report [2] https://www.cnbc.com/2025/07/12/binance-cz-threatens-to-sue-bloomberg-over-stablecoin-report.html [3] https://www.forbes.com/sites/jasonbrett/2025/07/12/binance-cz-threatens-to-sue-bloomberg-over-stablecoin-report/ [4] https://www.coindesk.com/binance-cz-threatens-to-sue-bloomberg-over-stablecoin-report [5] https://www.cnbc.com/2025/07/13/trump-crypto-interests-expand-with-memecoin-and-stablecoin-ventures.html [6] https://www.bloomberg.com/news/articles/2022-12-20/binance-accused-of-operating-ponzi-scheme-in-bloomberg-businessweek [7] https://www.bloomberg.com/news/articles/2025-04-20/binance-cz-denies-agreeing-to-testify-against-justin-sun [8] https://www.reuters.com/business/finance/binance-cz-serves-four-month-prison-sentence-2025-03-01/ [9] https://www.bloomberg.com/news/articles/2024-05-01/bloomberg-retracts-false-trump-binance-story-issues-apology
- Changpeng Zhao, co-founder of Binance, has threatened to sue Bloomberg for defamation over a claim linking him and Binance to the creation of a stablecoin, USD1.
- The report alleges that Binance helped design USD1’s smart contract, which was involved in a $2 billion investment deal, and CZ sought a presidential pardon from Trump shortly after the transaction.
- CZ vehemently denies all claims, characterizing Bloomberg's article as a "hit piece" full of "factual errors."
- As of mid-July 2025, there is no formal active legal proceeding publicly confirmed regarding this defamation lawsuit.
- The alleged use of USD1 in a $2 billion deal with Binance has sparked investigations into whether digital assets are being used to navigate or influence regulatory oversight.
- Meanwhile, Trump's crypto interests have been expanding rapidly in recent months, including an official memecoin, crypto-donor fundraising events, and multiple statements signaling strong support for Bitcoin mining and stablecoin innovation in the US.
- CZ has had disputes with U.S. media outlets in the past, dismissing reports as attempts to smear him and sparring with other media outlets.
- In 2024, Bloomberg Businessweek's Chinese-language edition retracted a story alleging Binance was operating a Ponzi scheme, admitting the headline was "false and baseless."
