WLFI to Launch Institutional-Grade Stablecoin USD1: Initially on Ethereum and BNB Chain, Backed by Policy Tailwinds and Trump Brand Effect
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WLFI to Launch Institutional-Grade Stablecoin USD1: Initially on Ethereum and BNB Chain, Backed by Policy Tailwinds and Trump Brand Effect
This move not only demonstrates the Trump family's ambitions in the crypto space, but is also seen as a key step to align with regulatory trends and leverage their brand power to capture market share.
Navigating Web3 tides with focused insightsAuthor: Nancy, PANews
The stablecoin market is experiencing explosive growth, with market capitalization rapidly climbing and an increasing number of new players entering the arena. Recently, Trump’s family-backed crypto project WLFI announced plans to launch USD1, a dollar-pegged stablecoin tailored for institutional use. This move not only highlights the Trump family's ambitions in the cryptocurrency space but is also seen as a strategic step to align with regulatory trends and leverage brand influence to capture market share.
Launching on Ethereum and BNB Chain, Targeting Institutional Markets
WLFI’s intention to enter the stablecoin space has been evident for some time.
As early as October last year, Rich Teo, former CEO of Paxos, joined WLFI as Head of Stablecoins and Payments. Paxos had issued several stablecoins, including BUSD developed in partnership with Binance. However, due to regulatory challenges, BUSD’s market cap has plummeted from a peak of $24 billion to just $50 million today. Shortly after Rich Teo’s appointment, Decrypt reported—citing sources—that WLFI was planning to issue its own stablecoin, which was still under development and might take some time before launch.
In mid-March this year, Bloomberg reported that WLFI had held discussions with Binance. According to insiders, topics included potentially co-developing a U.S. dollar-backed stablecoin. Four people familiar with the matter said it remains unclear how far the negotiations have progressed or whether any deal or collaboration will ultimately materialize.
Now, recent market rumors have finally been confirmed—WLFI officially announced the upcoming launch of USD1. According to official statements, USD1 is a stablecoin redeemable 1:1 for U.S. dollars and will be fully backed by short-term U.S. Treasury securities, U.S. dollar deposits, and other cash equivalents. Initially, USD1 will be minted on the Ethereum and BNB Chain blockchains, with plans to expand to additional protocols in the future. Its reserve assets will be custodied by BitGo, one of the largest digital asset custody firms in the United States, and subject to regular audits by independent third-party accounting firms.
Unlike algorithmic stablecoins or anonymous DeFi projects, USD1 combines the flexibility of DeFi with the credibility and safeguards of traditional finance, avoiding high-risk yield promises. Unlike other dollar-pegged stablecoins primarily targeting retail users, USD1 is positioned specifically for institutional clients, aiming to provide secure and efficient tools for cross-border payments and transactions, while supporting broad applications across the DeFi ecosystem. However, retail investors do not appear to be USD1’s primary target audience. WLFI co-founder Zach Witkoff emphasized, “USD1 is a digital dollar stablecoin custom-built for sovereign investors and large institutions, enabling seamless and secure cross-border transactions.”
Blockchain explorers show that USD1’s smart contract was deployed three weeks ago, with a total supply of approximately 3.5 million tokens. There are currently only six token holders, including market maker Wintermute’s address, which has already conducted several test transfers.
Binance founder CZ recently welcomed the deployment of USD1, stating that USD1 does not need to replace USDT or USDC—more stablecoins are better. He also warned that many scammers have created fake tokens with the same name, and since trading has not yet opened, users should beware of fraud.
Intensifying Stablecoin Competition: What Advantages Does USD1 Have?
The stablecoin market is expanding at an astonishing pace, growing increasingly significant within global financial markets.
According to DeFillama data, as of March 26, the total market cap of stablecoins exceeded $234.62 billion, setting a new all-time high and representing a 65.3% year-on-year increase. USDT and USDC dominate the market, collectively holding nearly 87.3% of market share. ARK Invest even predicts that the long-term stablecoin market could surpass $1 trillion in size. Bitwise Chief Investment Officer Matt Hougan further noted that once stablecoins reach this scale, the entire structure of the crypto market will be reshaped.
Meanwhile, according to a stablecoin report previously released by Dune and Artemis, as of February 2025, stablecoin supply reached $214 billion, with active addresses totaling 30 million. Annual transaction volume hit $35 trillion—twice the annual throughput of Visa. Notably, the report pointed out that while centralized exchanges remain the main venues for stablecoin liquidity, DeFi drives the majority of transaction volume.
The rapid development of stablecoins has been supported by increasingly mature global regulatory frameworks, with notable progress made in jurisdictions such as the United States, the European Union, Japan, and Singapore.
These advancements have created more room for innovation and adoption of compliant stablecoins. For example, USDC recently became the first stablecoin officially approved for use in Japan, while Thai regulators recognized USDT as a legitimate cryptocurrency. At the same time, competition is intensifying, with new entrants accelerating their entry. Fidelity has reportedly planned to launch its own stablecoin; Sam Altman, CEO of OpenAI, through his company World Network, is discussing a stablecoin payment wallet partnership with Visa; and crypto payments giant MoonPay acquired stablecoin firm Iron at a premium price.
Despite this, USD1 still holds clear competitive advantages. On one hand, evolving U.S. regulatory developments may pave the way for compliant dollar-pegged stablecoins. Notably, President Donald Trump recently emphasized that as the dollar transitions into stablecoins, it will help reinforce the dominance of the U.S. dollar globally. He called on Congress to pass landmark legislation establishing simple, common-sense rules for stablecoins and market structures.
Currently, multiple stablecoin bills are being actively advanced in the U.S., including the STABLE Act, GENIUS Act, and Waters proposals. These aim to create a clear regulatory framework for dollar-pegged payment stablecoins, promoting innovation while protecting consumers and enhancing the global competitiveness of digital dollars. The GENIUS Act stands out in particular—it was jointly introduced in bipartisan fashion in February 2025 and explicitly proposes establishing a federal regulatory framework, excluding payment stablecoins from the definition of securities and thus removing them from SEC (U.S. Securities and Exchange Commission) oversight. Issuers would be regulated at either the federal or state level depending on their scale. The bill also prohibits algorithmic stablecoins to mitigate systemic risks. Backed by both parties and the White House, the GENIUS Act recently passed the Senate with 18 votes in favor and 6 opposed, making it the most likely proposal to be signed into law by mid-2025. According to Bo Hines, Executive Director of the U.S. Presidential Working Group on Digital Assets, the U.S. stablecoin regulation bill could be submitted to President Trump for signature within two months.
On the other hand, the Trump brand effect provides WLFI with strong financial and resource backing. In terms of funding, WLFI has raised up to $550 million through community public offerings, with $390 million in net proceeds. In terms of resources, stablecoins play a crucial role in the DeFi ecosystem, and WLFI has established deep connections with leading DeFi projects through diversified investments, including Aave, Uniswap, Ethena, Chainlink, and Ondo Finance.
Overall, as the global stablecoin market expands rapidly and regulatory frameworks mature, the launch of USD1 represents a strategically significant move for WLFI—one that leverages policy tailwinds, a differentiated institutional focus, and the powerful influence of the Trump brand to build unique competitive advantages.
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