World Liberty Financial officially recognized the USD1 stablecoin today after it was discovered in the community yesterday. The project appears to be leveraging Trump's "stablecoin dollar dominance" plan and securing market share in the US market.
However, while WLFI claimed to include other cash equivalents in the stablecoin reserves, the current token holdings include over $111 million in unrealized losses.
World Liberty Financial Enters Stablecoin Market
World Liberty Financial (WLFI), a token project deeply connected to the Trump family, has been showing significant movement recently.
Two weeks ago, there were serious allegations that WLFI would acquire a stake in Binance, and predictions that the two companies would launch a new stablecoin. Today, some of those predictions were realized with USD1:
"WLFI announced plans to launch USD1 today. USD1 is a stablecoin exchangeable 1:1 with the US dollar. WLFI's USD1 is 100% backed by short-term US government bonds, US dollar deposits, and other cash equivalents. Initially, USD1 tokens will be issued on Ethereum (ETH) and Binance Smart Chain (BSC) blockchains." – From WLFI's press materials.
While WLFI's new stablecoin is native to BSC, Binance's actual involvement remains unclear. Yesterday, crypto detectives discovered that USD1 was issued 20 days ago and traded by market maker Wintermute.
Changpeng "CZ" Zhao, former CEO of Binance, may have shown insider knowledge of the project, but it was not clear.
However, today, CZ again hinted at his involvement. He responded to the WLFI stablecoin announcement with an eye emoji, indicating interest in the project but not promising specific actions.
WLFI did not further comment on the possibility of a partnership with Binance, and the token reserves are being held at Bitgo.
Meanwhile, this could be a significant opportunity for cryptocurrency. Trump recently announced that stablecoins would play a crucial role in promoting dollar dominance globally, and WLFI could participate in that initiative.
Tether might also be part of the "stablecoin dollar dominance" plan, but WLFI is moving first.
"USD1 provides access to the power of DeFi, backed by the credibility and safeguards of the most respected names in traditional finance. We are offering a digital dollar stablecoin that sovereign investors and major institutions can confidently integrate into their strategies." – Steve Witcoff, WLFI co-founder and Trump's diplomatic envoy.
Overall, the Trump family has been involved in several cryptocurrency projects recently. Yesterday, Trump Media announced a partnership with Crypto.com and plans to launch multiple ETFs.
WLFI claimed in its statement that "other cash equivalents" would be included in the stablecoin reserves, but provided no further explanation. The company claimed that third-party accounting firms would conduct regular audits, but like Tether, no actual audit has been conducted.
WLFI has completed token sales, but its portfolio includes over $111 million in unrealized losses from other cryptocurrency investments. The company is actively investing in various token projects, and questions about whether these assets will be used to build USD1's reserves were not answered in the launch announcement.
