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Billionaire Binance CEO CZ sues Businessweek’s Hong Kong publisher over ‘Ponzi scheme’ language

July 26, 2022, 4:21 PM UTC
Changpeng Zhao
Binance CEO Changpeng Zhao.
Nathan Laine—Bloomberg/Getty Images

Binance CEO Changpeng Zhao on Monday filed a lawsuit against Bloomberg Businessweek’s Hong Kong publisher Modern Media CL claiming defamation over a translated Chinese language article title that portrayed the crypto exchange chief as running a “Ponzi scheme.”

The suit stems from Bloomberg Businessweek’s June 23 profile of Zhao: “Can Crypto’s Richest Man Stand the Cold?” But in Hong Kong, Modern Media ran a different headline designed – according to Zhao’s representative – to spur “hatred, contempt and ridicule” for the world’s richest crypto billionaire: “Zhao Changpeng’s Ponzi Scheme.”

Zhao demanded a retraction, called for the edition’s removal from newsstands and for a restraining order to stop the defendants from further spreading the portrayal. Modern Media has already obliged in part.

Zhao separately filed a motion for discovery against Bloomberg LP and Bloomberg Inc. in the U.S. District Court for the Southern District of New York, claiming “defamatory allegations” in the profile piece.

There, Zhao took issue with the article’s portrayal of Binance as “sketchy” and with an anonymous quote from a trader that called Binance a “massive [s**tcoin] casino.” These statements “were obviously designed to mislead readers into believing” that Zhao was breaking the law, the motion read.

The dual legal actions continue Zhao’s aggressive image protection strategy for Binance. Binance sued Forbes in 2020 over allegedly defamatory statements but dropped the suit last year. (It later made a strategic investment in Forbes that was tied to a flopped SPAC deal). Zhao sued venture capital firm Sequoia claiming defamation in 2019.

The U.S. court filings underscore the extent to which Binance closely protects its reputation and how it is perceived. It recounts a back-and-forth between legal teams that resulted in Modern Media scrubbing the Ponzi headline and pulling the physical copy from print earlier this month. But “various online websites” were still selling the print edition, the filing states, prompting Zhao to go to court.

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