Trump Enters the Stablecoin Market with USD1, a Dollar-Pegged Asset

Former U.S. President Donald Trump has announced that his company, World Liberty Financial, will launch a stablecoin called USD1, redeemable at a 1:1 ratio with the U.S. dollar. The project comes as his administration increasingly supports digital tokens, which are the backbone of crypto transactions.

What is USD1?

According to the company, USD1 will be 100% backed by short-term U.S. Treasury bonds, dollar deposits, and cash equivalents. Asset custody will be handled by BitGo, and the tokens will initially be issued on the Ethereum and Binance Smart Chain blockchains. No official launch date has been announced.

"USD1 offers what algorithmic and anonymous crypto projects cannot—access to DeFi backed by the credibility and protection of the most respected names in traditional finance," said Zach Witkoff, co-founder of World Liberty.

The company emphasizes that the stablecoin will be a trusted instrument for institutional investors and governments, facilitating secure international transactions.

Partnerships, Controversies, and Binance’s Role

World Liberty was reportedly in talks with Binance about a possible partnership for developing USD1, according to Bloomberg News. However, Binance’s founder, Changpeng Zhao (CZ)—who pleaded guilty in 2023 to anti-money laundering compliance failures—denied any business ties to the project.

Trump’s interest in the crypto sector comes amid a political movement to integrate stablecoins into the U.S. financial system. Pending legislation in Congress aims to establish these assets as a core component of the country's payment infrastructure.

Currently, the total stablecoin market exceeds $230 billion, with major issuers like Tether Holdings reporting $13 billion in profits last year.

Politics and Stablecoins: The Trump Factor

World Liberty was launched in September 2023 as a DeFi platform focused on financial services without intermediaries. The Trump family—including Donald Trump Jr. and Eric Trump—has actively promoted the project, which is backed by Steve Witkoff, a longtime Trump ally and the current Presidential Envoy to the Middle East.

BitGo CEO Mike Belshe recently hosted a fundraising event for Trump's presidential campaign, further strengthening ties between the crypto industry and politics.

However, critics like Senator Elizabeth Warren warn of weak regulation and the potential vulnerability of stablecoins to financial crises. In a recent Senate hearing, Warren highlighted Binance’s controversial legal history and cautioned against uncontrolled growth in the sector.

With the 2024 presidential election approaching and Wall Street’s growing interest in the industry, Trump is positioning himself as a major advocate for stablecoins—a move that could reshape the global financial landscape.