Key Takeaways
- Former Binance CEO Changpeng Zhao, also known as CZ, is reportedly considering a libel lawsuit against U.S. Senator Elizabeth Warren.
- The potential lawsuit stems from statements made by Senator Warren on X (formerly Twitter) regarding Zhao’s recent presidential commutation.
- Zhao’s legal team has demanded a retraction of Warren’s statements, which they argue misrepresent his guilty plea.
- Senator Warren’s post suggested Zhao pleaded guilty to money laundering and alluded to corruption involving a stablecoin and a former U.S. President.
- Zhao’s defense clarifies his guilty plea was for failing to implement an Anti-Money Laundering program, not for the act of money laundering itself.
CZ Zhao Considers Libel Suit Against Senator Warren
Changpeng Zhao, the former CEO of cryptocurrency exchange Binance, commonly known as CZ, is reportedly exploring a libel lawsuit against U.S. Senator Elizabeth Warren. This potential legal action has been prompted by recent public statements made by the Senator concerning Zhao’s presidential commutation.
Sources indicate that Zhao’s attorney, Teresa Goody Guillén, has formally notified Senator Warren of her client’s intention to take legal action. The demand stipulates a retraction of specific claims made in an October 23rd post on X, which were published shortly after Zhao received a presidential commutation.
Senator Warren’s Statements Under Scrutiny
The X post in question, which has since been annotated with reader context, alleged that CZ pleaded guilty to a criminal money laundering charge and referenced a four-month prison sentence. However, it’s important to clarify that Zhao pleaded guilty in November 2023 to a charge related to the failure to maintain an effective Anti-Money Laundering (AML) program at Binance, a violation of the Bank Secrecy Act.
Guillén, as reported by The Post, stated, Mr. Zhao will not remain silent while a United States Senator seemingly misuses the office to repeatedly publish defamatory statements that impugn his reputation. She added, Accordingly, Mr. Zhao respectfully immediately requests the retraction of these false statements, both within the resolution and on X… Mr. Zhao reserves his right to pursue all legal remedies available to address these false statements.
Zhao Disputes Senator’s Allegations
Senator Warren’s tweet also included allegations that Zhao had financed President Trump’s stablecoin, characterizing the situation as corrupt. Zhao publicly refuted these claims on social media, emphasizing that there were NO money laundering changes [sic] and that Senator Warren can’t get her facts right.
Context Surrounding the Commutation
The presidential commutation granted to CZ by former President Donald Trump on October 23rd attracted significant attention from the cryptocurrency community and members of Congress. Some U.S. lawmakers raised questions about potential influences, speculating that an investment firm based in Abu Dhabi may have played a role. This firm reportedly invested $2 billion into Binance using the USD1 stablecoin, issued by World Liberty Financial, a company reportedly linked to the Trump family.
Cointelegraph reached out to Senator Warren’s office, Binance, and Guillén for comments regarding the potential lawsuit. As of the time of publication, no responses were received. Senator Warren had not issued any further public statements on the matter via social media, and her original X post remained accessible.
💡 This situation underscores the intense scrutiny faced by prominent figures within the cryptocurrency industry and their interactions with political figures and regulatory bodies.
Prior Legal Correspondences by CZ
This is not the first instance where Zhao has indicated potential legal action in response to public statements. In July, Zhao signaled his intent to sue Bloomberg over a report alleging that Binance had developed the core smart contract code for the USD1 stablecoin. That report also contained claims that Zhao had sought a presidential pardon following a $2 billion deal involving USD1 and Binance.
Furthermore, in 2022, the former Binance CEO initiated a lawsuit against Bloomberg Businessweek concerning an article published in its Chinese-language edition that accused the cryptocurrency exchange of operating a Ponzi scheme. In resolution, Bloomberg issued an apology in 2024, and the matter was settled with a charitable donation from Binance.
Expert Summary
Changpeng Zhao is reportedly considering a libel lawsuit against Senator Elizabeth Warren due to her public statements regarding his presidential commutation and alleged associations with Donald Trump’s stablecoin. Zhao’s legal team is demanding a retraction, highlighting the precise nature of his guilty plea concerning Anti-Money Laundering compliance failures, rather than money laundering itself. This developing situation illustrates the complex legal challenges that can arise from public accusations within the cryptocurrency sector.