Trump Stablecoin Backs Major Binance Investment

A stablecoin linked to Donald Trump is playing a role in a large $2 billion investment in Binance, according to reports.

This investment, by Abu Dhabi’s MGX in the crypto exchange Binance, has interested investors and analysts due to its size and the token involved. They are also looking at what this deal could mean for the broader crypto scene and the emerging tokens that could benefit from this shift.

Investors are closely watching to see how this agreement will unfold and shape the future of cryptocurrencies in this evolving landscape.

Trump’s Stablecoin Features in Binanace Deal

The installment of a stablecoin created by Donald Trump’s startup World Liberty Financial (WLF) has been announced for an Abu Dhabi fund’s $2 billion investment in Binance.

This investment by MGX in the biggest crypto exchange, founded by Changpeng Zhao, is among the biggest institutional pushes into crypto this year. It strengthens ties between Binance and the United Arab Emirates. But what makes the deal unusual is the involvement of a politically connected family’s stablecoin. It blends finance, politics, and crypto in a new way.

At the TOKEN2049 conference in Dubai on Wednesday, a World Liberty Financial spokesperson said USD1, the stablecoin pegged to the U.S. dollar and supported by U.S. Treasuries and cash equivalents to keep a constant $1 value, would be used for the investment.

The stablecoin is aiming to maintain a $1 value. It is also said to be supported by U.S. Treasuries and cash equivalents to keep a stable price.

This was later confirmed by Eric Trump, a son of the president and a major figure in WLF, who stated that the Abu Dhabi fund would be investing in Binance using USD1 tokens.

"We can confirm that the Abu Dhabi fund will be investing in Binance using USD1 tokens. We are pleased to see this institutional interest in the Web3 space," said Trump in a statement to Blockworks.

The Tron blockchain, backed by billionaire Justin Sun, also stated that it had plans for further collaboration and integration with the World Liberty Financial ecosystem.

This move comes as Binance faces legal challenges, including a plea bargain for violating U.S. money laundering laws and the subsequent imposition of penalties by the U.S. government.

As a result of these legal issues, Binance was forced to curtail its direct U.S. operations in 2023.

However, despite these setbacks, Binance continues to expand its global footprint and attract institutional investments. This latest investment by MGX further solidifies Binance's position in the cryptocurrency market.

World Liberty Financial was founded in 2024 with Donald Trump as its lead crypto champion and his sons Eric and Donald Jr. serving as web3 ambassadors for the startup.

The venture aims to launch a transparent and regulated stablecoin, emphasizing customer safety and cross-border financial transactions.

While USD1 has yet to be listed on major exchanges, it already boasts a market cap of about $2.1 billion, which is an indicator of the substantial investor interest in the venture.

This move has significant financial implications. Stablecoin issuers like WLF generate revenue by investing the deposits backing their coins.

With $2 billion linked to USD1 for one contract alone, the Trump family stands to earn huge returns—perhaps tens of millions annually—from this investment.

According to hints from Zach Witkoff, co-founder of World Liberty Financial, there are plans for USD1 to achieve a multi-billion dollar market cap and become widely accepted in retail and hospitality sectors.

He also mentioned the possibility of seeing USD1 integrated into luxury hotels in Abu Dhabi.

This interesting blend of politics, finance, and crypto innovation has sparked debate.

Those less enthusiastic about the move highlight potential conflicts of interest, noting that a foreign government-backed fund is using a Trump family stablecoin to invest in a company that is currently subject to legal investigation by the U.S. government.

Highlighting the Trump family’s venture, highlighting its web3 ambitions and the Mena region.

This is a new chapter in the ongoing saga of Binance’s legal woes and institutional expansion.