Crypto Exchange War Heats Up: Coinbase Fires Back Amid Binance Allegations

The gloves are off in the latest crypto exchange showdown. Coinbase just dropped a bombshell denial after whispers swirled about alleged attacks on Binance—turning up the heat in an already cutthroat market.

Who’s playing dirty?

Sources claim the rivalry escalated behind closed doors, with Coinbase executives dismissing accusations as 'baseless FUD.' Meanwhile, Binance loyalists are doubling down—fueling speculation of a PR war masquerading as industry drama.

Market impact? Minimal so far. Traders barely blinked as both platforms saw steady volume. Classic crypto: all hype, zero liquidity panic. Because nothing says 'decentralized future' like two billionaires arguing over who broke the sandbox first.

TLDR

• Coinbase strongly denied being an anonymous source in a Bloomberg investigation about Binance’s involvement with Trump-affiliated World Liberty Financial and USD1 stablecoin
• Binance founder CZ dismissed the Bloomberg report as a “hit piece” with factual errors and threatened legal action for defamation
• The controversy started when crypto influencers speculated that Coinbase leaked information to undermine Binance’s position in the U.S. market
• Bloomberg’s report showed Binance wallets holding over $2 billion in USD1 and detailed CZ’s efforts to seek a presidential pardon
• Both exchanges are competing for dominance as CZ seeks a pardon that could enable his return to the U.S. crypto market

The cryptocurrency industry witnessed a public dispute between two major exchanges after allegations surfaced about information leaks and media manipulation. Coinbase and Binance found themselves at the center of controversy following a Bloomberg investigation.

The dispute began when Binance founder Changpeng “CZ” Zhao amplified rumors on social media platform X. These rumors suggested that Coinbase may have acted as an anonymous source for a Bloomberg report about Binance’s involvement with World Liberty Financial and its USD1 stablecoin project.

Paul Grewal, Coinbase’s chief legal officer, issued a strong denial on July 13. He stated on X that the allegations were “pure misinformation” and emphasized that Coinbase did not contribute to the story. Grewal added that the exchange does not attack competitors and welcomes businesses that share their goal of growing the crypto market.

Sorry— this is pure misinformation. We absolutely did not contribute to this story.

We don't attack competitors, and we welcome any businesses that share our goal of growing the crypto pie.

You should keep looking for an actual source. https://t.co/OoJIEVqntS

— paulgrewal.eth (@iampaulgrewal) July 13, 2025

The Bloomberg report detailed Binance’s behind-the-scenes role in building and promoting USD1. The investigation showed that Binance wallets held over $2 billion in USD1 tokens. The report also highlighted CZ’s efforts to seek a presidential pardon from Donald Trump.

CZ responded by calling the Bloomberg article a “hit piece” sponsored by a competitor. He claimed the report contained numerous factual errors and threatened legal action for defamation. This marked another instance of Binance challenging media coverage through potential litigation.

4. FUD. Bloomberg just wrote another hit piece (sponsored by a competitor) containing so many factual errors I don't even know where to begin.

Might have to sue them again for defamation. https://t.co/FevGMArHj8

— CZ 🔶 BNB (@cz_binance) July 11, 2025

Exchange Competition Heats Up

The controversy reflects intense competition between the two leading crypto exchanges. Crypto influencers and commentators speculated about Coinbase’s potential motivations for allegedly leaking information. Some suggested that Coinbase was concerned about CZ’s possible return to the U.S. market.

Ian Miles Cheong posted criticism of Bloomberg and speculated about Coinbase’s involvement. He suggested that Coinbase might be using the TRUMP angle to attack Binance. Wall Street Mav defended Binance, stating that the exchange regularly assists with early-stage projects and that media coverage was attempting to create controversy.

The timing of this dispute is particularly sensitive for both companies. CZ is actively seeking a presidential pardon that could enable him to resume a leadership role in the U.S. crypto space. This potential return represents a direct challenge to Coinbase’s dominant position in the American market.

Regulatory Background and Market Position

Binance continues to maintain its position as the world’s largest crypto exchange by trading volume. The company has been working to restore its standing following regulatory settlements with U.S. authorities. These settlements resolved various compliance issues but allowed the exchange to continue operating globally.

Coinbase, meanwhile, has positioned itself as the leading regulated exchange in the United States. The company has built its reputation on compliance and regulatory cooperation. This positioning has helped it maintain market share despite facing competition from global players like Binance.

The Bloomberg report did not identify any sources from Coinbase specifically. However, the speculation from online commentators was sufficient to prompt both exchanges to issue public statements. This demonstrates the heightened sensitivity around reputational risk in the current political environment.

Both exchanges rejected involvement in any coordinated attack campaign. The episode illustrates how competition in the crypto industry increasingly extends beyond trading platforms into public and political arenas.

Bloomberg’s investigation revealed financial details about World Liberty Financial’s USD1 stablecoin project and its connections to the Trump family. The report showed substantial holdings in Binance wallets and detailed various financial transactions related to the project.