Stablecoin war continues
WLFI's strategy is straightforward—to exchange subsidies for liquidity. According to the governance proposal , the team will release 5% of WLFI tokens specifically to reward centralized and decentralized exchanges for listing and promoting USD1. This approach is equivalent to the "user acquisition cost" common in the traditional tech industry, except the competitors are stablecoin giants PayPal PYUSD and Tether USDT instead of mobile apps.
Currently, USD1 has a market capitalization of approximately $3 billion, which is $1.1 billion less than PYUSD's $4.1 billion. WLFI internal documents state bluntly that without rapid expansion, the market will be solidified by existing players, leaving little room for newcomers to turn the tide.
Subsidy strategies and gap narrowing
External doubts have arisen regarding whether short-term subsidies can drive long-term growth. WLFI responded that the funds will be allocated to three main scenarios: first, providing bilateral market-making rewards for liquidity pools pegged to USD1; second, subsidizing payment companies to integrate settlement interfaces; and third, providing rebates to cross-border remittance merchants. Ultimately, they are betting on "growing the pie first, then talking about profitability."
However, Disruption Banking's audit of on-chain data revealed that some of the USD1 trading volume may have been injected by market maker DWF Labs through anonymous wallets, and the true demand remains to be verified. Several community members expressed "unease" about this, fearing that the subsidies would ultimately just hand over the tokens to high-frequency traders.
Institutional Layout and Ecosystem Flywheel
WLFI doesn't want to be labeled a "meme coin." Canton Network has announced the deployment of USD1 on a regulated blockchain, standardizing asset collateralization and 24-hour settlement. On the other hand, its partnership with ALT5 Sigma opens up cross-border payment scenarios for USD1. WLFI emphasized this in an internal briefing:
"The larger the circulation of USD1, the higher the value of WLFI governance rights."
If this flywheel model operates smoothly, a cycle of subsidies → circulation → increased governance value → more capital inflow can be established. Conversely, if circulation becomes bloated or regulators apply the brakes, the flywheel may suddenly stall.
Regulatory shadow and governance risks
WLFI's relationship with the Trump family means that any of its financial moves are scrutinized. The 2025 GENIUS Act requires White House officials to declare their cryptocurrency holdings and prohibits them from influencing token prices. For WLFI to unlock the Treasury, it must prove that its subsidy program does not constitute a transfer of benefits.
In the forum, supporters argued that the buyback and subsidy package would "protect early investors," while opponents pointed out that large-scale unlocking could dilute their holdings. One investor bluntly commented, "If the $120 million is burned through and USD1 still can't catch up with PYUSD, who will foot the bill?" Although Trump wasn't directly mentioned, the implied political accountability was strong.
Meanwhile, the token buyback program has temporarily supported the price of WLFI, but it has also been criticized for conflicting with the subsidy program: the former shrinks circulation to stabilize the price, while the latter expands circulation to stimulate adoption. Whether the two approaches can be synchronized remains to be seen.
In summary, this $120 million initiative is a multifaceted test of capital efficiency, trust building, and policy red lines. Subsidies can buy current liquidity, but not perpetual credit; political prestige provides a voice, but also brings additional scrutiny. WLFI aims to prove itself as next-generation financial infrastructure, rather than simply a "presidential concept coin," and every subsequent governance vote and on-chain transfer will be a point of intersection between expectation and skepticism.
