World Liberty Financial, the cryptocurrency initiative launched by former President Donald Trump, is planning to introduce a U.S. dollar-backed stablecoin, according to a recent update. This move will position World Liberty Financial alongside industry giants such as Tether and USDC. The stablecoin project, still in development, is placing a strong emphasis on security before its market release. To lead the stablecoin and payments divisions, Rich Teo, co-founder of Paxos and a notable figure in the stablecoin sector, has joined World Liberty Financial. This development has the potential to impact Bitcoin and broader market trends.
Creating a stablecoin requires significant resources, including substantial capital and the ability to navigate complex regulatory frameworks. Tether and USDC are established players in this space, and any new entrant must be prepared to compete with them. The stability of these tokens relies on secure collateralization with fiat currency, as shown by the failures of alternatives like Terra.
The success of the stablecoin project could be highly profitable for the Trump family, as demonstrated by Tether’s recent report of $5.2 billion in profits for the first half of 2024. World Liberty Financial’s governance token, WLFI, was launched in early September and allows users to vote on the project, but it does not generate income and cannot be transferred.
Initially, the project aimed to raise $300 million from over 100,000 accredited investors. However, it has only secured $14 million so far, with only a small portion of tokens sold.
As the first former President to enter the crypto market, Trump’s involvement could have an impact on Bitcoin’s price. Previous instances of Trump publicly using Bitcoin, such as purchasing burgers with BTC, have resulted in market fluctuations.
At the time of writing, Bitcoin is trading at $69,804.37, with a 2.67% increase in the past day and a 4.03% increase over the past week.