Trump's World Liberty Financial Project Plans to Issue Stablecoin

Donald Trump’s controversial cryptocurrency project, World Liberty Financial (WLF) , has just raised $14 million in an initial token sale and is planning to develop its own stablecoin. The stablecoin, which is designed to maintain a stable value pegged to the US dollar, is still in development and the team is looking to ensure its safety before launching.
WLF has attracted attention for its plans to launch an Ethereum-based lending platform linked to the former U.S. President. Earlier this month, Rich Teo, co-founder of Paxos, was appointed to lead the project’s payments and stablecoins.

Stablecoins play an important role in the cryptocurrency ecosystem, allowing for safe transactions in volatile markets. To be successful, stablecoins need strong collateral, with Circle being one of the leading companies, holding $34.59 billion in assets to back its stablecoin, USDC .

Several other stablecoin projects have attempted to avoid fiat collateralization, often by using cryptocurrencies as collateral. Notably, the company Terra attempted to peg its stablecoin UST to the US dollar through an algorithmic combination with another cryptocurrency token. However, this strategy failed in May 2022, resulting in UST losing its peg and falling to zero, wiping out about $60 billion in value, causing major damage to the entire cryptocurrency market.
The legality of stablecoins remains controversial in the United States. The U.S. Securities and Exchange Commission (SEC) has sued companies like Binance for issuing stablecoins, arguing that the tokens were illegal securities offerings. However, the charges against Binance were dismissed by a federal judge earlier this summer.
Several prominent lawmakers have expressed their intention to vote on stablecoin-related legislation next year, creating a notable scenario if Trump is re-elected and controls the White House while Congress determines the legality of the financial product his partners are developing.
Despite facing many legal and regulatory risks, stablecoins could be highly profitable for WLF, with stablecoin revenue potentially fueling the project’s future plans. However, launching a new stablecoin in an already crowded market would be a major challenge, requiring partnerships with major exchanges like Coinbase and Binance.
Additionally, Trump and his allies have expressed concerns about the issuance of central bank digital currencies (CBDCs) , pledging to ban them if he is re-elected, emphasizing government control over private assets.