Trump’s Crypto Project Plans to Issue Stablecoin: Report
Donald Trump’s latest foray into cryptocurrency, World Liberty Financial (WLF), is said to be preparing to issue its own stablecoin as part of an ambitious expansion plan.
The news comes even as the project’s recent sale of its native token, WLFI, has only secured about $14 million from slightly more than 16,000 buyers.
WLF Stablecoin in the Works
According to a report from Decrypt citing sources familiar with the matter, the planned stablecoin remains in development as the WLF team aims to ensure rigorous safety features before it hits the market.
The product’s potential launch date is still unknown. However, the project has reportedly appointed Rich Teo, co-founder of blockchain infrastructure platform Paxos, as its stablecoin and payments lead, a move that analysts say signals World Liberty Financial’s commitment to stablecoin innovation. When asked for a response, neither Teo nor WLF commented on the purported development.
If it comes to fruition, a stablecoin could greatly enhance the company’s financial foothold. Issuers of such products usually generate profits by reinvesting deposits into yield-bearing assets such as U.S. Treasury bills. For example, Tether, the owner of the world’s largest stablecoin, USDT, recently reported a record $5.2 billion profit in the first half of 2024.
However, the digital asset, with a current market value of $120.2 billion, has had questions raised about its reserve strategy. Its parent company has revealed that it holds 82,454 BTC and 48.3 tons of gold, valued at upwards of $9 billion. Company CEO Paolo Ardoino also clarified that the cache includes about $100 billion worth of U.S. Treasury bonds.
WILFI Token Sales and Regulatory Concerns
While WLF is expected to channel substantial funds into its proposed stablecoin to make it a reality, sales of its native WLFI token have been rather sluggish. The latest on-chain data from Dune shows that it has only managed to raise $14.3 million so far, with more than 80% of that figure received on the first day. This only amounts to a fraction of the project’s $300 million target.
Further, there are concerns regarding the regulatory environment for stablecoins in the United States. The Securities and Exchange Commission (SEC), hugely unpopular in crypto circles, has scrutinized several large digital asset companies recently, including Binance, over issues related to stablecoins and potential violations of U.S. securities laws.
Although some charges were eventually dismissed, the uncertainty that such actions created could present challenges for World Liberty. However, many feel that a potential return to the White House in November for Donald Trump could work in the project’s favor.
The Republican presidential candidate has portrayed himself as a steadfast crypto ally in the last few months. Some believe that his administration could directly impact the legal landscape for cryptocurrencies, including stablecoins, which could inadvertently benefit his business interests.
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