This is a segment from the Empire newsletter. To read full editions, subscribe.
Yesterday, former Binance CEO Changpeng Zhao praised “USD1” and posted, “Welcome to BNB Chain!”
A couple of hours later, World Liberty Financial noted that USD1 is not “currently tradable,” and seemingly took ownership of the new stablecoin.
And, after a lot of speculation and even more texts sent out from yours truly, we finally have some answers this morning. USD1 will be minted on Ethereum and Binance Smart Chain blockchains, though the team isn’t ruling out future protocols, per a press release.
“WLFI’s USD1 will be 100% backed by short-term US government treasuries, US dollar deposits, and other cash equivalents,” the release said.
BitGo will custody the USD1 reserves. In a statement, CEO Mike Belshe praised the stablecoin as an advancement in “institutional-ready digital assets.”
“USD1 provides what algorithmic and anonymous crypto projects cannot — access to the power of DeFi underpinned by the credibility and safeguards of the most respected names in traditional finance,” said Zach Witkoff, WLFI co-founder.
It’s still unclear from the press release what role Wintermute was playing, though it looked like it was potentially in the mix (per Etherscan). No word back from the Wintermute team yet, either.
WLFI just closed $550 million in token sales last week and, in an accompanying press release, said: “Over the last six months, WLFI has established key relationships with leading blockchain protocols and institutions including Ondo Finance, Ethena, Chainlink, Sui and Aave. These relationships have positioned WLFI to more rapidly build and deploy its upcoming platform, which is being purpose-built to democratize finance for millions.”
But the project hasn’t been without its criticism, with our very own Jack Kubinec reporting last month that it was courting other teams for token swaps.
Now we’ll just have to see what’s next for WLFI. And the biggest question is: What players are involved?
Get the news in your inbox. Explore Blockworks newsletters:
- Blockworks Daily: The newsletter that helps thousands of investors understand crypto and the markets, by Byron Gilliam.
- Empire: Start your morning with the top news and analysis to inform your day in crypto.
- Forward Guidance: Reporting and analysis on the growing intersection of crypto and macroeconomics, policy and finance.
- 0xResearch: Alpha directly in your inbox. Market highlights, data, degen trade ideas, governance updates, token performance and more.
- Lightspeed: Built for Solana investors, developers and community members. The latest from one of crypto’s hottest networks.
- The Drop: For crypto collectors and traders, covering apps, games, memes and more.
Source: https://blockworks.co/news/bitgo-to-custody-wlfi-usd1