Original | Odaily Planet Daily ( @OdailyChina )
Author: Wenser ( @wenser 2010 )
Since WLFI officially announced the launch of the 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 US dollars . In comparison, it took USDT about 5 years to achieve this milestone (early 2019); USDC took about 2 years (September 2020). Although the maturity of the cryptocurrency industry is different, achieving this achievement in such a short period of time shows the strong development momentum of USD 1. In view of this, Odaily Planet Daily will sort out the development ideas of USD1 and the possibility of large-scale adoption in the future in this article for readers reference.
USD1 s high-profile road: first occupy Ethereum and BSC, then TRON
On March 25, when market news was raging, WLFI officially announced that it would soon launch an institutional-grade stablecoin - USD1 .
According to the official announcement, USD1 will be 100% backed by short-term U.S. Treasury bonds, U.S. 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 is designed to maintain a value of $1 and is fully backed by a reserve portfolio that is regularly audited by a third-party accounting firm; USD1 reserves will be held by BitGo, the worlds largest independent qualified custodian.
At that time, as a strong competitor of USDT and USDC and a stablecoin project backed by the Trump family project WLFI, USD1 once caused market speculation, and many people believed that it might replace the two stablecoins USDT and USDC. In this regard, Binance founder CZ once stated : USDT and USDC do not need to be replaced, the more stablecoins the better. As for the reason behind this, it is naturally because BSC is one of the main ecosystems supporting USD1 .
In the following days, as Congress was deliberating the Stablecoin Genius Act, five Democratic senators jointly wrote a letter to the Federal Reserve and the OCC, questioning the unprecedented risks brought by the USD 1 stablecoin launched by the Trump familys crypto project WLFI. They pointed the finger at Trump, saying that he weakened regulatory independence through an executive order in February and held a 60% stake in WLFI, which constituted a major conflict of interest.
Despite this, USD1 has been smoothly promoted step by step, and in May, WLFI co-founder Zack Witkoff confirmed that USD1 will also be issued natively on the TRON chain. On June 14, the first USD1 was successfully minted on the TRON chain. TRON founder Justin Sun officially announced the news, which was later confirmed by Trumps second son Eric Trump .
Looking back at the development path of USD1 , a “new stablecoin”, in the past two months, it can be regarded as a model of the complementary advantages and disadvantages.
USD1 ’s odd and even path: Institutional adoption is positive, Meme liquidity is odd
The Art of War by Sun Tzu says: In every battle, use the normal tactics to unite and the unusual tactics to win. It means that when two armies fight, there are generally only two ways to fight: one is to engage in a head-on confrontation using conventional tactics, and the other is to launch a surprise attack using unusual tactics.
For a stablecoin project like USD1 , since it does not have the first-mover advantage of early stablecoin projects such as USDT and USDC, and Trump, as the President of the United States, has neither the ability nor the intention to promote its large-scale adoption by executive orders or mandatory policies, it needs to have both the conventional approach of frontal advancement and the extraordinary preparations to break through the siege.
USD1 ’s path to success: institutional investment and institutional adoption
For a stablecoin project, the most important goal is to have people use it. For an early stablecoin project, compared with retail investors with dispersed liquidity, institutional adoption has a stronger demand and a larger liquidity scale, which is why USD1 has focused on institutional adoption since its inception.
Specifically, WLFI has taken two actions to promote institutional adoption of USD1 :
First, in terms of investment. According to Eric Trump, the second son of Trump, the USD1 stablecoin issued by WLFI has been officially selected as the official stablecoin to complete the $2 billion investment of the UAE sovereign fund MGX in Binance. As the first huge financing case in the history of cryptocurrency, MGXs investment in Binance is undoubtedly a highlight in the history of cryptocurrency development. As the official stablecoin of this financing, USD1 will also create a typical case for the adoption of stablecoins worldwide. While promoting its own large-scale adoption, it will promote the credibility and availability of encrypted stablecoins to the global economic market. In addition, at the end of May, WLFI officially announced that USD1 will be the only designated stablecoin sold by the well-known AI project Sahara Labs (SAHARA) on the Buidlpad platform. In the investment track, the climate of USD1 has been established.
Second, in terms of crypto market makers. DWF Labs, one of the well-known cryptocurrency market makers, is also one of the important partners of USD1 . It not only participated in the early interaction of USD1 , but also obtained 1 million USD1 for market making in early April. In addition, wallet users holding USD1 can also participate in the internal testing and Farm activities of Falcon Stable, a stablecoin protocol under DWF Labs. Not only that, in addition to DWF Labs, the well-known market maker Wintermute was the number one institution holding USD1 on the chain at that time , and Wintermute OTC platform also opened USD1 support .
Third, in terms of exchanges and crypto projects. USD1 has also received strong support from the BSC ecosystem. In addition to the BSC chain as a native issuance network, Lista Lending, a pillar project of the BSC ecosystem, launched USD1 Vault in mid-April, which is the first application of the stablecoin on the BSC chain. In addition, Binance announced in May that users will enjoy zero handling fees when withdrawing USD1 through BNB Chain. Subsequently, with the gradual development of USD1 , BounceBit, Kernel DAO , BSC ecosystem AI data annotation project Tagger , and many crypto exchanges have followed up with USD1 related support.
In addition, Amber International, a US-listed company, has also included USD1 in its $100 million crypto ecological reserve plan, and internet celebrity Hasbullas BULLA token pre-sale also received USD1- related funds.
It can be said that crypto exchanges and crypto projects, crypto market makers, crypto investment institutions and platforms together constitute the institutional adoption landscape of USD1 .
USD1 ’s surprise attack: Meme liquidity and large-scale airdrop distribution
Stablecoins that only have institutional participation are not good stablecoins. After all, the majority of the crypto market are still retail investors.
In order to promote the use and popularization of USD1 at the market user level, WLFI also chose to walk on two legs:
First, by encouraging and supporting Meme coin projects to build USD 1 liquidity pools, the wider adoption of USD 1 can be promoted. The landmark event of this move was WLFIs first purchase of Binance Alpha token BuidlON (B) tokens, and the reason behind it was that B tokens launched USD 1 liquidity pools. For details, see the article BUILDon, endorsed by WLFI, has a market value of US$400 million. What other targets are worth paying attention to? . Not only that, WLFI also subsequently launched a USD 1 trading competition (liquidity promotion activity) with multiple BSC ecological projects to encourage BSC ecological Meme coin projects to create USD 1 trading pools. In the latest event, the Meme token EG L1, which is centered on American culture, won the first place in the event because of its trading volume of nearly US$200 million in the past week.
USD 1 Trading Competition Ranking
Second, WLFI planned to airdrop USD1 to WLFI token holders as early as April. After the community proposal was voted through, the plan was officially implemented in early June, airdropping 47 USD1 tokens to the WLFI subscriber address (the market speculates that this number may be related to Trump being the 47th President of the United States), and airdropping a total of 4 million US dollars in a short period of time. It has to be said that perhaps the development path of every stablecoin project is inseparable from the link of spending a lot of money.
The latest news is that WLFI has been officially connected to OKX Wallet. Users will be able to seamlessly access the project through OKX Wallet and participate in cross-chain services such as the stablecoin USD1 . In this regard, WLFI and USD1 have successfully completed the last piece of the puzzle for their own applications - industry infrastructure such as encrypted wallets.
Conclusion: USD1 ’s explosive potential is worth looking forward to
According to Coinmarketcap data , USD1s current 24-hour trading volume is approximately US$600 million, of which CEX trading volume accounts for approximately 20%; DEX trading volume accounts for approximately 80%, which shows that its development route of combining the odd and the even has begun to show results.
At the critical juncture when the US stablecoin regulatory bill Genius Act is about to be implemented, with the support of the Trump family and WLFI, the application scenarios of USD 1 are expected to be further expanded. By then, it may become another major stablecoin project after the leading crypto stablecoin USDT and the first stablecoin stock token USDC.
Even influenced by President Trumps identity, USD1 may play the role of a trading currency or an important medium for resolving tens of trillions of U.S. Treasury bonds in the subsequent tariff trade war.
Recommended Reading
The golden age of stablecoins begins: USDT goes left, USDC goes right
How the Trump family is using TRUMP tokens to reap the crypto market
