Circle Shareholder Sues Trump and World Liberty Over $2B USD1 Deal

A Circle Internet Financial shareholder, J. Benjamin Greenberg, filed a lawsuit against US President Donald Trump, his family's crypto venture World Liberty Financial, its affiliates, and US Special Envoy to the Middle East Steve Witkoff. The suit was filed Thursday, October 22, 2026, in the US District Court for the District of Columbia, centering on a $2 billion deal between a foreign government entity and crypto exchange Binance.

Greenberg says he holds 10,000 ordinary shares of Circle, the company behind the USDC stablecoin. In his filing, he alleges that Trump, Witkoff, and World Liberty created a pathway for foreign governments to funnel money through the Trump family's USD1 stablecoin. He calls this "brazen corruption" that leaves Circle "unable to compete" in the stablecoin market.

USD1 and USDC, two competing stablecoins

To understand why this matters, it helps to see where these two stablecoins sit. A stablecoin is a crypto asset pegged to a fiat currency, usually the US dollar, at a one-to-one ratio. USDC has long been one of the largest stablecoins used on exchanges and in DeFi protocols. USD1 is the stablecoin issued by World Liberty Financial, the crypto venture founded by the Trump family.

When a foreign government entity chooses USD1 for a major transaction like the Binance investment, the volume and trust that would typically flow to an established player like USDC can get diverted elsewhere. That is the core of Greenberg's argument: not that USD1 underperforms technically, but that it gained preferential access through proximity to power.

The $2 billion MGX deal with Binance

The lawsuit centers on MGX, an Abu Dhabi investment entity tied to UAE royalty. In 2025, MGX poured $2 billion into Binance using the USD1 stablecoin, making it one of the largest cross-border crypto deals involving a foreign government entity to date.

The Wall Street Journal had previously reported in February that another investment vehicle backed by Sheikh Tahnoon bin Zayed Al Nahyan agreed to buy a 49% stake in World Liberty for $500 million. Together, these two deals paint a picture of how quickly Middle Eastern capital flowed into the Trump family's crypto circle.

"By accepting hundreds of millions of dollars from a foreign government, the President and his companies have diverted business from [Circle]," Greenberg wrote in the filing, according to Cointelegraph.

The legal basis: the Foreign Emoluments Clause

Greenberg is asking the court to declare that Trump violated the US Constitution's Foreign Emoluments Clause through these crypto deals. The clause bars federal officials from accepting gifts, titles, or financial benefits from foreign governments without congressional consent, a rule dating back to the founding era meant to keep officials free of foreign influence.

Beyond a declaratory ruling, Greenberg is also seeking injunctions to stop Trump and Witkoff from pursuing similar financial interests without Congress's approval. If granted, that could limit how much room the Trump family's crypto ventures have to operate while he remains in office.

Zach Witkoff, son of defendant Steve Witkoff, is a co-founder of World Liberty Financial. Trump and his three sons are also listed as co-founders, putting the president's immediate family squarely at the center of the case.

Circle, the White House, and World Liberty respond

A Circle spokesperson told Cointelegraph the company "did not initiate, direct, authorize, or participate in the filing," declining further comment on the pending litigation, a typical stance for a public company amid active legal proceedings.

White House spokesperson Anna Kelly said Trump has "no conflicts of interest" tied to his crypto investments and called the lawsuit "frivolous." World Liberty Financial had not responded to requests for comment as of this writing.

Big earnings, bigger investor losses

Trump and his family are tied to several crypto ventures beyond World Liberty. According to nonprofit consumer advocacy group Public Citizen, these ventures netted Trump $1.4 billion in 2025. The same report found retail investors lost roughly $4.7 billion across various crypto projects tied to the president.

That gap between Trump's earnings and investor losses is part of why his family's crypto ventures keep drawing scrutiny. These dealings are just one of several controversies surrounding Trump, alongside the scrutiny over his acceptance of a jet from the Qatari government.

Political backdrop ahead of the midterms

The lawsuit lands less than two weeks before the 2026 US midterm elections, with early voting already underway in several states. Democrats defending their seats are using Trump's crypto dealings as a campaign wedge issue to rally voters.

Last week, Senator Mark Warner released a campaign ad highlighting that Trump made "more than $600 million alone from the crypto memecoin." The issue adds political pressure around the president's family crypto ventures, even as his administration has largely pursued crypto-friendly policy.

What it means for traders

The lawsuit is unlikely to move USDC or USD1 prices directly in the short term, since both remain pegged to the dollar with no signs of a liquidity or reserve problem. The things worth watching are the indirect effects.

First, track how the case proceeds in the DC District Court, particularly if the court issues any temporary order limiting World Liberty's activity or its Middle East investment partners. A ruling like that could affect capital flows that have been moving through USD1.

Second, watch for any regulatory response toward USD1, since the suit raises questions about transparency of foreign government funds moving through a stablecoin tied to sitting US officials. That kind of response could show up through congressional hearings or statements from financial regulators.

Third, expect this issue to keep surfacing as campaign material ahead of midterm election day. That kind of political pressure has historically shaped congressional debate on stablecoin legislation and conflict-of-interest rules for public officials involved in digital assets.

Who filed this lawsuit?

J. Benjamin Greenberg, who holds 10,000 ordinary shares of Circle Internet Financial, filed the suit in the US District Court for the District of Columbia on Thursday, October 22, 2026.

What is the core allegation?

Greenberg alleges that Trump, Steve Witkoff, and World Liberty Financial let a foreign government entity funnel money through the USD1 stablecoin, undercutting Circle's ability to compete with its USDC stablecoin.

What is the $2 billion deal at issue?

In 2025, Abu Dhabi-linked investment firm MGX, tied to UAE royalty, invested $2 billion into crypto exchange Binance using the USD1 stablecoin.

How have Trump and World Liberty responded?

White House spokesperson Anna Kelly said Trump has no conflicts of interest and called the lawsuit frivolous. World Liberty has not responded, while Circle said it did not initiate or participate in the filing.