Tensions in the crypto sector escalated over the weekend following allegations that Coinbase was the unnamed source behind a Bloomberg report scrutinizing Donald Trumps crypto project, World Liberty Financial, and Binance.

Coinbase exec, however, has denied the allegations.

Allegations Stir Crypto Rivalries

Crypto commentator Matt Wallace claimed on X that Coinbase executives were concerned that a potential pardon for Binances former CEO Changpeng CZ Zhao could clear the way for his return. He alleged they attempted to undermine the crypto exchange out of fear that its re-entry into the US market would threaten Coinbases market share.

Wallace described Coinbases alleged targeting of Trump as anti-American, and added that the companys leadership viewed Binances legal return as a direct threat to their business. The post was later reshared by Zhao, who neither confirmed nor denied the claims but indicated that he may consider legal action against Bloomberg for defamation.

Bloombergs report had detailed Binances involvement in creating the smart contract for USD1, a stablecoin issued by World Liberty Financial, while linking Zhao to a request for a presidential pardon shortly after the token featured in a multibillion-dollar UAE investment deal with Binance. The report further stated that a significant share of USD1 tokens remains in Binance wallets, which suggests potential interest earnings for the exchange.

Coinbases chief legal officer, Paul Grewal, responded directly to Wallaces accusations on X and called them pure misinformation. He also asserted that Coinbase had no involvement in providing information to Bloomberg.

We dont attack competitors, and we welcome any businesses that share our goal of growing the crypto pie. You should keep looking for an actual source.

Standard Collaboration, Not Corruption

The episode has drawn significant attention from industry players. Blockchain advisor Anndy Lian also criticized Bloombergs report on Binance and Trump. In a post on X, Lian noted the article relied on anonymous sources without concrete evidence of payments or explicit coordination between Trump and CZ.

He argued the piece exploited a national tragedy for political narratives and lacked a factual basis. He also added that the crypto exchanges activities align with industry norms and that no direct evidence links Trumps business interests to policy decisions.

CZ had stepped down as Binances CEO last year following legal settlements with US authorities, and has kept a relatively low profile ever since. In May, CZ confirmed applying for a presidential pardon from Trump after reports linked him to such efforts.

Citing Trumps past BitMEX pardons, the Binance co-founder said that hes the only person jailed solely for a BSA violation. Despite seeking clemency, CZ said that he wont return to Binance leadership.