Trump’s crypto project plans to launch its own US dollar-backed stablecoin – report
World Liberty Financial, former president Donald Trump’s cryptocurrency venture, debut its native token earlier this month and is now planning something more ambitious: its own stablecoin, which could serve as an alternative to the US dollar, according to Decrypt.
Stablecoins, a cryptocurrency pegged 1:1 to the value of a fiat currency like the dollar or euro, have become extremely popular over the past three years. If report about World Liberty, published on Monday by cryptocurrency publication Decrypt, is correct, the World Liberty team will participate as PayPal, Coinbaseand Robinhood, all have or are developing their own versions of stablecoins.
An anonymous source told Decrypt that the World Liberty stablecoin is still in development and will take time to launch as the team works to determine “how to make the financial product secure before launching it.” to the market”.
Those who closely follow the platform may have seen this development coming. Earlier this month, the World Liberty team announced that Rich Teo, co-founder of Paxos—a stablecoin issuer that manages the US dollar-backed Paxos Standard Token or PAX—will join the platform to serve as stablecoin and lead pay.
However, building a stablecoin is not as easy as hiring a person. It requires large amounts of capital and navigating unclear legal and regulatory boundaries, not to mention the stamina to compete with giants like Tether and USDC.
To secure the value of a stablecoin at a stable price, it must be collateralized or backed by fiat currency. Some projects have tried to circumvent this requirement with crypto gimmicks, but these have mostly collapsed spectacularly, as was the case in 2022 when stablecoin issuer Terra failed. failed, wiping out billions of dollars.
Despite lingering questions about how the World Liberty team plans to develop a trustworthy stablecoin, the Trump family stands to make significant profits if the project is successful. Tether, the world’s largest stablecoin, reported record profits of $5.2 billion in the first half of 2024 alone.
World Liberty Financial, announced in early September, a month and a half before the election, was is described as a “decentralized financial currency market”. WLFI is the so-called governance tokena token that allows holders to make decisions, vote on proposals, and manage an on-chain cryptocurrency project. Tokens are non-transferable and do not earn profits.
Ahead of the launch, the company has whitelisted more than 100,000 accredited investors and hopes to raise $300 million from its initial sale. It fell short of that goal, with $14 million raised and only 4.7% of tokens offloaded.
