Donald Trump’s World Liberty Financial (WLFI) has announced that its newly launched stablecoin, USD1, will be the settlement currency for a $2 billion investment by Abu Dhabi-based MGX into Binance.
The revelation, made at the ongoing Token2049 conference in Dubai by WLFI co-founder Zach Witkoff, marks a major milestone for the fledgling stablecoin, which has surged to a $2.1 billion valuation in record time despite its absence from major centralized crypto exchanges.
A Rapid Ascent for USD1
Witkoff framed the partnership as a vote of confidence in USD1’s stability and utility. “We thank MGX and Binance for their trust in us,” he stated.
Eric Trump, also present at the Dubai event, noted that digital assets like USD1 could “disintermediate financial institutions” and reduce the reliance on untrusted governments or currencies. His rhetoric aligns with his father, U.S. President Donald Trump’s transitional stance from crypto skeptic to self-styled champion of the industry.
While MGX’s deal for a minority stake in Binance was first announced in March, the decision to use USD1 for settlement had been kept under wraps until now. The $2 billion deal stands as the largest funding agreement involving a crypto platform, and it is noteworthy as the largest to be executed in stablecoin.
USD1’s rise has been nothing short of meteoric. Within weeks of its launch, its market cap exceeded the $1 billion mark, outpacing the initial performances of more established rivals like Tether’s USDT and Circle’s USDC.
With 2,127,970,381 units circulating, the stablecoin now boasts a market cap of over $2.1 billion. Witkoff recently took to X to celebrate the milestone, with BitGo, USD1’s custody and infrastructure provider, hailing it as “the fastest rise from 0 to $1B in stablecoin history.” The company has played a crucial role in USD1’s development, utilizing its Stablecoin-as-a-Service platform to foster the asset’s rapid growth.
Initially deployed on Ethereum and Binance Smart Chain (BSC), the stablecoin is slated for expansion to the Tron network, whose founder, Justin Sun, invested $75 million in WLFI earlier this year.
Stablecoin Hierarchy Under Threat?
The U.S. dollar-pegged coin’s explosive growth occurs in an increasingly competitive stablecoin sector, leading to speculation about its political affiliations and swift adoption by institutional players such as MGX.
Nonetheless, its $2 billion valuation remains significantly lower than USDT’s $149.3 billion, which constitutes over 61% of the total stablecoin market. Reports indicate that USDT dominates the Tron network, holding a 98.5% share of its stablecoin supply, while other competitors like USDD, TUSD, and USDC account for 1.15%, 0.26%, and 0.06%, respectively.
However, USD1 is yet to be listed on major centralized exchanges such as Binance and Coinbase. Analysts anticipate that such listings could significantly enhance its liquidity and potentially reshape the stablecoin hierarchy in the process.
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