Coinbase Denies Link to Binance Stablecoin Report

Coinbase has firmly denied allegations that it was the source behind a recent report linking Binance, a major cryptocurrency exchange, to a stablecoin project associated with World Liberty Financial. The exchange's chief legal officer, Paul Grewal, took to X to refute these claims, stating that Coinbase had no involvement in the story. Grewal described the allegations as misinformation and advised that the search for the actual source should continue. He emphasized that Coinbase does not engage in attacking competitors and welcomes any businesses that share its goal of growing the crypto industry.

Grewal's response came after a post by crypto personality Matt Wallace on X, which alleged that evidence showed Coinbase was the anonymous source for the story. Wallace suggested that Coinbase aimed to prevent Binance from regaining its full strength in the US, which would happen if its founder, Changpeng Zhao, were to get a pardon. Wallace's post, which has garnered over one million views, also described the alleged action as anti-American for targeting the US president. Interestingly, Zhao retweeted the post, leading to speculations that he might believe it to be true. Despite Grewal debunking the allegations, the post remains up.

The controversy stems from a report that claimed Binance developed the smart contract for USD1, a stablecoin launched by World Liberty Financial. The report further alleged that the creation of the stablecoin and its use for the $2 billion investment in Binance UAE sovereign fund are all connected to Zhao’s attempts to get a presidential pardon. USD1 has a circulating supply of $2.20 billion, with Binance holding around $2 billion. Zhao has criticized the report as a hit piece and even suggested that a competitor sponsored it. The crypto billionaire added that he might sue for defamation again, referencing his previous lawsuit against the media house in 2022, which led to the company publishing an apology.

Zhao has never hidden his disdain for mainstream publications, noting that they mostly spread false claims about the crypto industry and himself. He confirmed some weeks ago that he had applied for a presidential pardon, noting that he used the stipulated process and has never met the US President. The controversy surrounding Binance and World Liberty Financial has added to the scrutiny faced by Zhao, who is currently awaiting sentencing. His actions, both legal and political, continue to have ripple effects across the cryptocurrency markets and in Washington. The situation highlights the growing links between digital assets and high-level political figures, particularly as the 2024 election cycle approaches.

Coinbase's denial of the allegations underscores the complex and often contentious nature of the cryptocurrency industry. As the industry continues to evolve, it is likely that similar controversies will arise, requiring careful navigation and transparency from all parties involved. The denial by Coinbase serves as a reminder of the importance of accurate reporting and the potential consequences of misinformation in the financial world. The situation also highlights the need for transparency and ethical conduct in the cryptocurrency industry, as well as the potential for conflicts of interest and political influence. The controversy surrounding Binance and World Liberty Financial serves as a cautionary tale for the industry, emphasizing the importance of responsible reporting and the potential consequences of misinformation.