LONDON, March 25 (Reuters) – World Liberty Financial, a cryptocurrency venture linked to Donald Trump, is preparing to launch a new dollar-pegged stablecoin called USD1. The announcement comes after the company raised $550 million through the sale of a separate digital token.
USD1 is designed to maintain a value of $1 and will be fully backed by U.S. Treasuries, dollars, and other cash equivalents, according to a statement released by World Liberty. The move places the venture into direct competition with existing stablecoins. These digital assets, like Tether and USDC, have become a key part of the multi-trillion dollar crypto trading market, facilitating transactions between cryptocurrencies and traditional currencies.
Zach Witkoff, co-founder of World Liberty, speaks at the Republican National Convention in Milwaukee, Wisconsin.
Zach Witkoff, co-founder of World Liberty, stated that “sovereign investors and major institutions” would be able to integrate USD1 “into their strategies for seamless, secure cross-border transactions.”
World Liberty emphasized that USD1 will be “fully backed by a reserve portfolio audited regularly by a third-party accounting firm,” though details on the accounting firm or the specific launch date were not provided.
Founded shortly before Trump’s victory in the 2016 U.S. presidential election, World Liberty was announced by Trump, his sons, and Steve Witkoff, a real estate businessman and the father of Zach Witkoff, who is now Trump’s Middle East envoy. Trump, who has expressed his intention to be a “crypto president,” has pledged to revise U.S. regulations on cryptocurrency and reverse the stricter measures enacted under former President Joe Biden’s administration.
This venture, alongside other crypto interests of Trump, including a meme coin launched in January, has already prompted criticism from government ethics experts and political opponents who have raised concerns about potential conflicts of interest.
World Liberty aims to enable access to financial services without intermediaries, such as banks. USD1’s reserves will be held in custody by BitGo, a California-based company. BitGo will support USD1 by providing its prime brokerage services to institutional clients. Kevin Lehtiniitty, CEO of Borderless.xyz, suggested USD1 would encounter substantial competition from established stablecoins like Tether and USDC, issued by Circle.
USD1 is intended to be launched on both the Ethereum and Binance Smart Chain blockchains. World Liberty also plans to introduce USD1 on additional blockchains in the future. Binance, the world’s largest crypto exchange, launched its Smart Chain in 2020. Changpeng Zhao, Binance’s founder and former CEO, was sentenced to a four-month prison term in the U.S. last year after pleading guilty to violating U.S. laws related to money laundering. Binance also paid a $4.3 billion fine after prosecutors stated that the company welcomed criminals and failed to report over 100,000 suspicious transactions involving designated terrorist groups.
A spokesperson for Binance did not immediately respond to a request for comment regarding the partnership.
(Reporting by Tom Wilson and Elizabeth Howcroft; Editing by Louise Heavens and Joe Bavier)
