Will Trump’s Stablecoin Become a Political Flashpoint in the U.S.?

▲ Donald Trump, Changpeng Zhao, Stablecoin / ChatGPT-generated image ©

A standoff is emerging between a cryptocurrency exchange and political circles over a stablecoin backed by the Trump family. As Binance expanded related promotions, Democrats intensified their offensive, citing national security and taxpayer protection.

According to DL News on February 20 (local time), Binance announced that it would extend its rewards program for USD1, a dollar-pegged stablecoin issued by World Liberty Financial operated by President Trump’s sons, until March 20. Holders of USD1 will receive WLFI tokens via an airdrop. A total of 235 million WLFI tokens will be distributed over a month.

USD1 is a stablecoin backed by securities such as U.S. Treasury bonds. Its issuance has surged 50% over the past month, surpassing $5 billion. It has climbed to become the fifth-largest stablecoin by circulating supply. According to Arkham data, Binance holds custody of 76% of all USD1. The exchange previously ran a program offering up to 20% returns on USD1 holdings of up to $50,000. The company stated that its participation falls within its standard services, including listings and infrastructure support.

Lawmakers, however, are taking a critical view. Senator Elizabeth Warren sent a letter to Treasury Secretary Scott Bessent urging an investigation into World Liberty Financial. She raised national security concerns based on reports that a company linked to the United Arab Emirates (UAE) had acquired a $500 million stake. The deal was reportedly signed four days before President Trump’s inauguration, with 49% of the company sold. Warren also warned the Treasury Department and the Federal Reserve against using taxpayer funds to bail out the cryptocurrency industry.

Meanwhile, Binance co-founder Changpeng Zhao (CZ) previously admitted to violating U.S. law over deficiencies in anti-money laundering programs and served four months in prison in 2024. President Trump pardoned Zhao in October last year. Zhao denied any connection between his pardon and cooperation with World Liberty Financial, stating, “Crypto does not need a bailout, and it never will.” The White House also emphasized that the president is not directly involved in the related business.

The issue is further intensifying regulatory debates as stablecoin business interests intertwine with political considerations. Amid a cryptocurrency downturn that has erased $2 trillion in market value, the Trump family’s crypto ventures now face both policy risks and political pressure.

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