World Liberty Financial Launches USD1 Stablecoin Amid Growing Market

February 13, 2025 – New York, NY

World Liberty Financial (WLFI), a decentralized finance venture supported by former President Donald Trump and his family, has launched a new stablecoin called USD1. The announcement was made on Tuesday, marking the company’s entry into an increasingly competitive stablecoin market.

Stablecoin Launch and Structure

USD1 will be pegged to the U.S. dollar and will be backed by short-term U.S. government treasuries, dollar deposits, and other cash equivalents. The stablecoin is set to go live on the Ethereum and Binance Smart Chain networks, providing users with the ability to conduct transactions seamlessly and securely.

Co-founder Zach Witkoff highlighted the advantages that USD1 offers over other projects in the space. "USD1 provides what algorithmic and anonymous crypto projects cannot — access to the power of DeFi underpinned by the credibility and safeguards of the most respected names in traditional finance," he stated. "We’re offering a digital dollar stablecoin that sovereign investors and major institutions can confidently integrate into their strategies for seamless, secure cross-border transactions."

Market Context

This launch comes at a time when the market capitalization for dollar-backed stablecoins has surged, climbing more than 46% over the past year and reaching new all-time highs, according to data from CryptoQuant. Traditionally, the stablecoin market has been dominated by Tether (USDT) and Circle’s USDC, but the entrance of WLFI adds another competitor to the mix.

Since its October debut, World Liberty Financial has successfully raised $550 million through two token sales, including $250 million reported just last week. The project, described as a crypto banking platform, indicated that entities associated with the Trump family could receive up to 75% of the venture’s net revenue.

The token sales attracted significant interest, drawing more than 85,000 verified participants and securing investments from high-profile backers, including Tron founder Justin Sun, who increased his stake to $75 million earlier this year.

Political and Regulatory Backdrop

The emergence of USD1 coincides with an accelerated crypto agenda by the Trump administration. Recently, President Trump signed an executive order for creating a Strategic Bitcoin Reserve, and David Sacks, the administration’s crypto czar, revealed the recent sale of over $200 million in digital asset investments to mitigate potential conflict-of-interest concerns.

Witkoff expressed optimism about the project, stating, "We’re on track to supercharge DeFi," despite growing scrutiny related to its financial structure and political connections.

The Increasing Significance of Stablecoins

Stablecoins have become a vital aspect of the cryptocurrency ecosystem, serving essential roles in trading on both centralized and decentralized exchanges as well as providing collateral for DeFi applications. Their importance is underscored by comments from Treasury Secretary Scott Bessent, who noted plans to use stablecoins to maintain U.S. dollar dominance in the global market.

In recent gatherings, including the Digital Asset Summit in New York City, President Trump remarked on the transformative potential of stablecoins, asserting, "This industry will unleash an explosion of economic growth, and with dollar-backed stablecoins, you’ll help expand the dominance of the U.S. dollar."

As the demand for regulatory clarity grows, stablecoin legislation appears to be gaining momentum. The bipartisan GENIUS Act, aimed at structuring the regulatory framework for stablecoins, recently advanced out of the Senate Banking Committee.

Experts believe that establishing regulatory guidelines for stablecoins could significantly reinforce U.S. dollar dominance globally, with Galaxy Digital’s head of research, Alex Thorn, commenting, "Stablecoins could solidify dollar dominance for 100 years."

In this evolving financial landscape, the introduction of USD1 reflects both innovation in the cryptocurrency sector and the increasing interplay between cryptocurrency ventures and traditional finance. As regulatory frameworks develop, the future of stablecoins will likely play a critical role in shaping the broader economic landscape.

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