World Liberty Financial (WLFI) has officially confirmed its USD1 stablecoin, following community speculation. The project appears to align with Donald Trump’s push for stablecoin-driven dollar dominance. However, concerns remain about its reserves, as WLFI holds over $111 million in unrealized losses.
WLFI Enters the Stablecoin Market
WLFI, a token project linked to the Trump family, has been making big moves in crypto. Rumors recently suggested WLFI might acquire a stake in Binance and launch a new stablecoin. While Binance’s role remains uncertain, part of the prediction has materialized.
On March 25, 2025, WLFI confirmed plans for USD1, a stablecoin pegged 1:1 to the U.S. dollar. The company claims USD1 will be fully backed by short-term U.S. Treasuries, dollar deposits, and other cash equivalents. It will be available on Ethereum (ETH) and Binance Smart Chain (BSC).
Is Binance Involved?
Despite USD1 launching on BSC, Binance’s official involvement is unclear. Crypto analysts discovered that USD1 was minted 20 days before its public announcement. Market maker Wintermute had already been trading it.
Adding to the mystery, former Binance CEO Changpeng “CZ” Zhao reacted to the WLFI stablecoin announcement with a cryptic eyes emoji on social media. While this hints at interest, there’s no direct confirmation of Binance’s role.
For now, BitGo is acting as the custodian for WLFI’s reserves.
Trump’s Push for Stablecoin Dominance
Trump recently emphasized stablecoins as a key tool for maintaining U.S. dollar dominance. WLFI’s USD1 could play a major role in this strategy, potentially challenging Tether’s dominance in the stablecoin market.
WLFI co-founder Steve Witkoff, who also serves as Trump’s diplomatic envoy, framed USD1 as a stablecoin for major institutions and sovereign investors.
Meanwhile, Trump’s broader crypto involvement is growing. His media company Trump Media recently announced a partnership with Crypto.com, with plans to launch multiple ETFs.
Concerns Over WLFI’s Reserves
Despite its ambitions, WLFI’s financial situation raises red flags. The company claims USD1’s reserves will include “other cash equivalents,” but hasn’t provided details.
Additionally, WLFI’s crypto investments have resulted in $111 million in unrealized losses. This raises concerns about whether the company might use volatile crypto assets to back USD1.
WLFI promises third-party audits, but as of now, no audit has been conducted—a situation similar to Tether’s early days.
What’s Next for USD1?
While WLFI’s USD1 stablecoin could strengthen the U.S. dollar’s role in global finance, questions remain about its reserves, transparency, and potential Binance connections. If WLFI delivers on its promises, USD1 could emerge as a serious competitor to Tether and USDC. But for now, the market remains cautious.
