CZ Denies USD1 Allegations as Binance Faces Renewed Trump-Linked Scrutiny
CZ denies claims linking Binance’s role in USD1 to his Trump pardon request as BNB activity cools amid controversy.
Binance founder Changpeng Zhao (CZ) has denied recent allegations tying him to a $2 billion investment deal involving Trump-backed World Liberty Financial (WLFI) and its stablecoin, USD1. The claims surfaced following a Bloomberg report suggesting Binance had a direct role in the development and promotion of USD1—a stablecoin now ranking as the fifth-largest by market cap.
According to the report, Binance allegedly designed the smart contract infrastructure behind USD1 and promoted it to its user base of over 275 million. it claimed that Abu Dhabi-based MGX channeled $2 billion into Binance by opting to use USD1 over competing stablecoins. Though the report did not confirm whether CZ or Binance were paid for these services, it reignited speculation around the exchange’s proximity to former President Donald Trump.
CZ responded via X, strongly rejecting the idea that his pardon application—filed earlier this year—was contingent upon any collaboration with Trump-affiliated entities. “The timeline simply doesn’t support the claim,” he stated, clarifying that his application came after the media had already speculated on the issue.
The USD1 stablecoin, launched in March 2025, has quickly amassed a $2.2 billion market cap, driven by its political branding and support from WLFI. While its growth has garnered investor attention, it has also drawn regulatory interest due to potential conflicts of interest and financial influence surrounding Trump’s political activities.
This isn’t the first time CZ has been linked to the Trump family. In May, a Wall Street Journal article alleged the Trump family had shown interest in acquiring a stake in Binance U.S.—a claim CZ called a “hit piece.” The timing of his pardon application has also been controversial. Initial denials gave way to confirmation that an application had indeed been filed, albeit after earlier reports.
Binance and CZ have a contentious regulatory history in the U.S. In 2023, they were fined $4.3 billion and $50 million respectively for violations of anti-money laundering laws. CZ also stepped down as CEO and served a four-month jail sentence.
Amid the controversy, Binance’s native token BNB showed signs of cooling. On-chain data from Glassnode indicated a 5% drop in daily active addresses and a 20% decline in volume, falling to $467 million. Despite the dip, BNB held relatively steady at $690, up 14% from June lows. Flat funding rates suggest the market is in wait-and-see mode, potentially bracing for further developments.
