Original | Odaily (@OdailyChina）
Author | Wenser (@wenser 2010）
Since WLFI officially announced the launch of stablecoin USD1 on March 25, in less than 3 months, the circulation of USD1 has exceeded 2 billion, with a market value of $2.18 billion. In comparison, USDT took about 5 years (early 2019) to reach this milestone, while USDC took about 2 years (September 2020). Despite the different maturity levels of the crypto industry, achieving such results in such a short time demonstrates the strong development momentum of USD1. In light of this, Odaily will review the development strategy and potential for large-scale adoption of USD1 in this article for readers' reference.
USD1's Path of Strategic Advancement: First Ethereum and BSC, Then TRON
On March 25, amid widespread market rumors, WLFI officially announced the upcoming launch of the "institutional-ready stablecoin" - USD1.
According to the official announcement, USD1 will be 100% backed by short-term US Treasury bonds, US dollar deposits, and other cash equivalents. Initially, USD1 tokens will be minted on Ethereum and BSC chains, with plans to expand to other protocols in the future. Each token aims to maintain a value of $1, fully supported by a reserve investment portfolio audited regularly by a third-party accounting firm. USD1 reserves will be custodied by BitGo, the world's largest independent qualified custody institution.
At the time, as a strong competitor to USDT and USDC, backed by the Trump family project WLFI, the USD1 stablecoin once sparked market speculation, with many believing it might replace the two major stablecoins. Binance founder CZ had previously stated: "USDT and USDC do not need to be replaced, the more stablecoins, the better." The reason is naturally that BSC is one of the main ecosystems supporting USD1.
In the following days, during the congressional review of the "Stablecoin Genius Act", five Democratic senators jointly wrote to the Federal Reserve and OCC, questioning the "unprecedented risks" brought by the USD1 stablecoin launched by the Trump family's crypto project WLFI, directly pointing at Trump, claiming that he weakened regulatory independence through the February executive order and holds 60% of WLFI's shares, constituting a significant conflict of interest.
Despite this, USD1 continued to progress smoothly and was confirmed by WLFI co-founder Zack Witkoff in May to be natively issued on the TRON chain. On June 14, the first USD1 was successfully minted on the TRON chain, with TRON founder Justin Sun officially announcing this and subsequently confirmed by Eric Trump.
Looking back at USD1's development route over the past 2 months, it can be described as a perfect example of complementary strategies.
USD1's Strategic Path: Institutional Adoption as the Main Strategy, MEME Liquidity as the Supplementary Approach
Sun Tzu's "Art of War" says: "In battle, use the orthodox to engage, use the unorthodox to win." This means that in warfare, there are generally two approaches: one is to engage in a frontal confrontation using conventional tactics, and the other is to launch a sudden attack using unconventional methods.
For a stablecoin project like USD1, lacking the early-mover advantage of previous stablecoins like USDT and USDC, and with Trump neither able nor willing to promote its large-scale adoption through executive orders or mandatory policies, it needs to employ complementary strategies - both conventional frontal approaches and extraordinary preparations to break through.
USD1's Legitimate Path: Institutional Investment and Institutional-Level Adoption
For a stablecoin project, the most important goal is to be "used". For an early-stage stablecoin project, institutional-level usage needs are more robust and liquidity scale more massive compared to scattered retail market liquidity, which is why USD1 has focused on institutional adoption since its inception.
Specifically, WLFI made two moves to promote USD1's institutional adoption:
First, in the investment sector. According to Eric Trump's previous statement, USD1 has been officially selected as the official stablecoin for MGX's $2 billion investment in Binance. As the first massive financing case in crypto history, MGX's investment in Binance is a significant milestone, and as the official stablecoin for this deal, USD1 will create a prime use case for stablecoin adoption globally, promoting the credibility and usability of crypto stablecoins. Additionally, in late May, WLFI officially announced that USD1 would be the sole designated stablecoin for the AI project Sahara Labs (SAHARA) on the Buidlpad platform. In the investment track, USD1's climate is already established.
Second, in the crypto market-making sector. DWF Labs, a well-known crypto market maker, is also an important partner of USD1. Not only did they participate in USD1's early interactions, but they also received 1 million USD1 tokens for market-making in early April. Moreover, wallet users holding USD1 can participate in DWF Labs' Falcon Stable protocol beta test and Farm activities. Beyond DWF Labs, the renowned market maker Wintermute was previously the top on-chain holding institution for USD1, and Wintermute's OTC platform has also opened support for USD1.
Third, in terms of crypto exchanges and crypto projects. USD1 also received strong support from the BSC ecosystem. Apart from BSC chain as the native issuance network, BSC ecosystem pillar project Lista DAO's lending product Lista Lending launched USD1 Vault in mid-April, marking the first application of this stablecoin on the BSC chain. Additionally, Binance announced in May that users can withdraw USD1 through BNB Chain with zero transaction fees. Subsequently, as USD1 gradually develops, projects including BounceBit, Kernel DAO, BSC ecosystem AI data annotation project Tagger, and many crypto exchanges have followed up with USD1 support.
Moreover, the publicly traded company Amber International previously incorporated USD1 into its "100 million USD crypto ecosystem reserve plan", and the pre-sale of internet celebrity Hasbulla's BULLA token also received participation from USD1-related funds.
It can be said that crypto exchanges, crypto projects, crypto market makers, crypto investment institutions and platforms collectively form USD1's "institutional adoption map".
USD1's Surprise Strategy: Meme Liquidity, Widespread Airdrop Distribution
A stablecoin with only institutional participation is not a good stablecoin, after all, most of the crypto market still consists of retail investors.
To promote and popularize USD1's usage among market users, WLFI also chose a two-pronged approach:
First, by encouraging and supporting Meme coin projects to build USD1 liquidity pools to promote wider adoption of USD1. A landmark event was WLFI's first purchase of Binance Alpha token BuidlON (B) token, with the underlying reason being that the B token launched a USD1 liquidity pool. Not only that, WLFI subsequently collaborated with multiple BSC ecosystem projects to launch a USD1 trading competition (liquidity promotion activity), encouraging BSC ecosystem Meme coin projects to create USD1 trading pools. In the latest event, the Meme token EG L1, centered on American culture, won first place due to its trading volume of nearly $200 million in the past week.
USD1 Trading Competition Leaderboard
Second, WLFI planned to airdrop USD1 to WLFI token holders as early as April. After a community proposal vote passed, the plan was officially implemented in early June, airdropping 47 USD1 tokens to WLFI subscription addresses (market speculation suggests this number might be related to Trump being the 47th US president), and quickly accumulated airdrops totaling $4 million. It must be said that perhaps every stablecoin project's development path cannot do without the "massive token distribution" phase.
In the latest news, WLFI has officially integrated with OKX Wallet, allowing users to seamlessly access the project and participate in cross-chain services for the stablecoin USD1. With this, WLFI and USD1 have successfully completed the final piece of their application puzzle—crypto wallet and other industry infrastructure.
Conclusion: USD1's Explosive Potential is Worth Anticipating
According to Coinmarketcap data, USD1's 24-hour trading volume is currently around $600 million, of which approximately 20% is from CEX trading and about 80% from DEX trading, demonstrating that its "complementary" development route has already shown initial effectiveness.
At the critical juncture of the upcoming US stablecoin regulatory bill "Genius Act", backed by the Trump family and WLFI, USD1's application scenarios are expected to expand further, and it may become another major stablecoin project following the "crypto stablecoin leader" USDT and the "first stablecoin stock token" USDC.
Moreover, influenced by President Trump's identity, USD1 might potentially serve as an important medium for trade currency or resolving tens of trillions of US national debt in future trade wars.
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