In-Depth Review of the Growth Logic of WLFI and USD1 Dual Token System

For stablecoins, besides the backend processes of issuance (compliance/audit/asset management), the most important aspects are circulation and trading, which are also key to future competition among other stablecoins.

Written by: Sea

Unknowingly, USD1 (4.2 billion USD) has become the fourth largest stablecoin after USDT (183.8 billion), USDC (73.5 billion), USDS, and DAI (11.5 billion). It is also the fastest-growing stablecoin in the past year.

In the past six months, I have held a certain amount of USD1 on Binance, so I attempted to summarize the growth logic of the USD1 stablecoin under World Liberty Financial in a complete article, hoping to provide some insights for users and other project parties.

Image source: Bitou @DRbitcoin36

Phase One: Tying Up with UAE and Binance

Undeniably, USD1 is a project born with a golden spoon.

As a DeFi protocol, World Liberty Financial, associated with the Trump family, first initiated the project in September 2024, selling WLFI tokens to investors in October, which also serves as the governance token for the project. USD1 was launched in March 2025, initially deployed on Ethereum and BNB Chain. In the first two months, very few people in the market paid attention to USD1. By late April, USD1's scale was less than 200 million USD.

The market first took significant notice of USD1 in May 2025 when Abu Dhabi's sovereign fund MGX invested 2 billion USD in Binance.

This investment was made in USD1, which directly pushed USD1's issuance beyond the 2 billion USD mark and was crucial for USD1's cold start.

In the same month, Binance listed USD1-related trading pairs on its exchange. Throughout the subsequent multi-level growth process, Binance continued to play an important role.

Phase Two: Expanding Trading and DeFi Scenarios

From the second half of 2025 to now, USD1 has been continuously expanding its trading scenarios, including spot/contract/RWA assets on Binance, on-chain DeFi, and deployments on other public chains.

• In June, USD1 was airdropped to WLFI presale participants.
• Jointly promoted USD1 trading on DEX with PancakeSwap.
• Listed trading pairs of USD1 with mainstream coins like BNB/ETH/SOL/Pepe on Binance, followed by multiple perpetual contracts.
• Besides Ethereum and BNB Chain, USD1 was deployed on eight other public chains, including Solana, Aptos, Tron, Monad, Plume, and Tempo, with over 1 billion USD on Solana alone.
• In March this year, Binance supported USD1's participation in Launchpool and increased USD1 in the exchange's reserve proof.
• Aster allowed USD1 as collateral and distributed 2.5 million WLFI tokens to traders monthly, later making USD1 the only settlement stablecoin for all TradFi perpetual contracts on the Aster platform.
• Launched high-yield activities on Monad chain.
• In the AI wave, launched Agentic SDK and WorldClaw project.
• Introduced lending market WLFI Markets.
• Sponsored the world's largest mixed martial arts event, UFC Freedom 250, with USD1.
• Collaborated with Byreal in the Solana ecosystem, offering 1 million WLFI tokens to incentivize USD1 trading competitions.
• Applied for a national trust bank license from the Office of the Comptroller of the Currency (OCC).
• Integrated with Binance Pay, allowing USD1 payments in all supported scenarios, such as when I recently bought an Apple gift card with USD1.

This series of brand and market activities surrounding USD1 aims to:

• Increase awareness of USD1, directly endorsed by the Trump family.
• Encourage more people to hold USD1, with deployments across multiple public chains and yield for holders.
• Promote more usage of USD1, entering multiple exchanges and supporting more spot/contract trading pairs.

With this combination of strategies, USD1's issuance directly surpassed the 3 billion USD mark, representing an organic growth process.

Phase Three: Ongoing Subsidy War for Over Six Months

In December 2025, to attract more users to hold USD1 stablecoin, the WLFI team collaborated with Binance for an activity where users could place USD1 in Binance Wealth Management, with a single order limit of 50,000 USD1, to enjoy an annualized return of 20%.

Airdrops have also been a major driver for more people to hold USD1. Perhaps this activity showed good results for the WLFI team, leading them to increase efforts. From January until now (currently in the seventh round), they have conducted over six months of subsidies through Binance, distributing more than 126 million USD in $WLFI.

Here are the main data points from these seven rounds of activities:

• Round One (1/23 - 2/20): 40 million USD equivalent in WLFI, annualized about 15%.
• Round Two (2/20 - 3/20): 235 million WLFI, valued at about 27 million USD, annualized about 13%.
• Round Three (3/20 - 4/17): 135 million WLFI, valued at about 12 million USD, annualized about 8%.
• Round Four (4/17 - 5/15): 15 million USD equivalent in WLFI, annualized about 7%.
• Round Five (5/15 - 6/12): 13 million USD equivalent in WLFI, annualized about 5.9%.
• Round Six (6/12 - 7/10): 178 million WLFI, valued at about 10 million USD, annualized about 5.6%.
• Round Seven (7/10 - 8/7): 165 million WLFI, valued at about 9.6 million USD, annualized about 5.3%.

If someone held 100,000 USD1 on the initial date of 2026/1/23, they would have 104,470 USD1 by 2026/8/7, with an average annualized return of 8.32% over six and a half months.

Review of USD1's yield over the past six months

More importantly, these airdrop activities do not limit the USD1 volume per user, allowing large holders and institutions to participate. This has made USD1 the most generous and popular stablecoin among retail investors during this bear market in 2026, receiving countless accolades in the community—despite the yield dropping from the initial 20% to 15%, then to 8% and below 6%, USD1 remains a conscientious choice compared to traditional banks' less than 1% annualized returns and the high risks of on-chain DeFi.

Besides Binance, USD1 has also conducted similar activities through exchanges like Bybit, Gate, and MEXC, with APY even reaching 20%.

Gains and Costs

In summary, the series of activities in the three phases above have encouraged more people to exchange USDT/USDC for USD1, leading to USD1's issuance surpassing 5 billion USD at the beginning of the year.

With the growth in scale, the project party World Liberty Financial has also gained considerable USD reserve asset income, ranking 9th among all protocols in 30-day income, reaching 11.49 million USD; generating 115 million USD in revenue over the past 12 months.

USD1 contributed significantly to WLFI's main income, data from DefiLlama

USD1 has become the most important business segment within the entire WLFI project, contributing major income second only to WLFI token sales. It is unclear whether this was planned from the project's inception in September 2024.

We can compare WLFI's ongoing subsidies for over six months to the red envelope subsidy strategies used by Meituan/Didi during their early growth stages. However, WLFI tokens are the Growth Tokens in this structure, and the cost is the continuous pressure on WLFI's price, which is a burden for holders.

In simpler terms, the project party has exchanged WLFI token subsidies for the growth of USD1's scale and corresponding interest income. In this process, WLFI has been distributed to a large number of retail investors in the market, which is a form of indirect