Coinbase accused of smear campaign against Trump-linked World Liberty Financial, Binance

The crypto world is embroiled in controversy after explosive claims surfaced that Coinbase may have been behind a coordinated attack on Binance and the Trump-linked World Liberty Financial (WLFI) project.

The allegations, made by an X user known as Wallace, suggest the U.S.-based exchange sought to undermine its rivals as Binance eyes a potential return to the American market.

With Binance commanding a staggering $19 billion in 24-hour trading volume compared to Coinbase’s $3 billion, the stakes are high.

The situation grows more complex with rumors that former Binance CEO Changpeng “CZ” Zhao could receive a pardon from former President Donald Trump, whose ties to the Trump-linked World Liberty Financial project have drawn scrutiny.

The “anonymous source” controversy

Wallace’s tweet ignited a firestorm by accusing Coinbase of being the unnamed origin of negative reports targeting both Binance and the Trump-linked World Liberty Financial initiative.

“Evidence is emerging that Coinbase was the ‘anonymous’ source behind the hit job on President Trump’s World Liberty Financial and Binance,” Wallace stated.

The claims gained traction after Bloomberg published articles scrutinizing WLFI’s connections to Binance, including meetings in Abu Dhabi between CZ and WLFI founders to discuss crypto industry standards.

Reports also allege Binance contributed source code to WLFI’s USD1 stablecoin—a claim that, if true, could deepen regulatory and political tensions.

Coinbase’s Chief Legal Officer, Paul Grewal, swiftly denied involvement:

“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.”

Despite the denial, CZ’s ambiguous retweet of Wallace’s allegations has fueled speculation, leaving investors questioning Coinbase’s transparency.

Political and market fallout

The clash transcends typical corporate rivalry, intersecting with U.S. political dynamics. The Trump-linked World Liberty Financial project, which aims to promote crypto adoption, has become a flashpoint in the debate over fair competition and regulatory oversight.

Critics argue Coinbase’s alleged tactics reflect desperation to maintain dominance. “This isn’t just business—it’s anti-American,” Wallace asserted, framing the dispute as part of a broader ideological battle over crypto’s future.

Meanwhile, Binance’s potential U.S. reentry looms large. Banned since 2023 over money laundering charges, its resurgence, potentially aided by a Trump pardon, could upend Coinbase’s market position.

Investor confidence at risk

The controversy arrives during a fragile period for crypto markets, already strained by regulatory crackdowns. Accusations of smear campaigns threaten to erode trust further, particularly among retail investors.

“When giants clash, the little guys get trampled,” said crypto analyst Maria Vasquez of Chainalysis. “These allegations, if proven, could trigger a backlash against centralized exchanges altogether.”

Data from CoinMarketCap shows the disparity between Binance’s global dominance and Coinbase’s narrower reach—a gap that may widen if Binance regains U.S. access.