Original article | Odaily Odaily( @OdailyChina )
Author | Ethan ( @ethanzhang_web3 )
On March 4, Trump posted on Truth Social , specifically criticizing the banking industry for threatening and undermining the GENIUS Act. He urged Congress to expedite the implementation of the crypto market structure bill and warned that if the framework is delayed, the United States' advantage in the crypto field will be handed over to other countries. His strong wording and urgent tone made him appear as a defender advocating for the industry.
However, if you know that World Liberty Financial (WLFI), owned by the Trump family, is the issuer of the stablecoin USD1, the meaning of this statement becomes much more nuanced. One of the most direct beneficiaries of the GENIUS Act is precisely the family business of the person who posted this message from the White House.
This isn't the first time. Since Trump's return to the White House in January 2025, his crypto empire has never truly been separated from his presidency. The two hats have always been on the same person's head—it's just that in the past few weeks, the overlap between them has become harder to ignore than ever before.
On one hand, the family project USD1 suffered a coordinated attack in late February, briefly de-pegging, and the WLFI team subsequently transferred a large number of tokens to centralized exchanges for two consecutive days, with on-chain signals fueling market speculation; on the other hand, the president himself was in Washington leading the charge for stablecoin legislation, launching a direct counterattack against the obstruction of bank lobbying groups.
Two lines of thought are running simultaneously, converging within the same family, at the same time, and on the same issue. This is what makes the current Trump crypto narrative truly interesting.
USD1 stress test
In March 2025, World Liberty Financial officially launched USD1, a stablecoin pegged 1:1 to the US dollar. Its reserve assets consist of short-term US Treasury bonds, dollar deposits, and cash equivalents. It is custodied by the crypto custodian BitGo, and monthly reserve certificates are issued regularly by the accounting consulting firm Crowe. In its design framework, it aligns with regulatory compliance, rather than offshore stablecoins with ambiguous reserves and questionable transparency.
The timing of its entry was impeccable. Just as discussions surrounding the GENIUS Act were heating up and market expectations for compliant stablecoins were rising, USD1 made its debut in a distinctive way: I am the US dollar, I am compliant, and I have the backing of a presidential family. In May 2025, Abu Dhabi's sovereign wealth fund MGX announced a strategic investment of $2 billion in USD1 in Binance. This deal instantly propelled USD1 from a newcomer to the crypto world to an undeniable player in the global stablecoin landscape.
By March 2026, USD1's circulating market capitalization had reached approximately $4.5 billion, firmly placing it among the top five stablecoins globally. However, some details behind this scale are noteworthy: According to research by data analytics platform Kaiko, over half of USD1's liquidity on PancakeSwap comes from market-making wallets associated with the WLFI team, rather than genuine market trading demand; and its monthly active user base in USD terms is still significantly smaller than established players like USDT and USDC. Political endorsement is the strongest marketing resource, but it cannot replace genuine market depth.
On February 23, 2026, a sudden stress test disrupted this delicate balance.
That morning, USD1 briefly decoupled from its peg , with the price falling to $0.994, deviating from the $1 peg by approximately 0.6%. WLFI immediately issued an alert on the X platform, characterizing the volatility as a coordinated attack involving multiple parties: the attackers compromised the social media accounts of several WLFI co-founders, hired KOLs to spread panic information on a large scale, and simultaneously opened short on WLFI tokens, attempting to profit from the artificially created chaos.
WLFI spokesperson David Wachsman later told the media that the project's engineering and security teams successfully withstood a coordinated attack from multiple directions, and that the events of the day precisely demonstrated that USD1's design was robust and could be relied upon under any conditions. USD1 subsequently recovered to around $0.998, with the 1-to-1 redemption mechanism acting as an anchor and preventing a deeper crisis of trust.
In retrospect, the attack was indeed unsuccessful. However, considering the context, this attack occurred at a highly sensitive time—just days earlier, WLFI had hosted a high-profile crypto summit at Trump's Mar-a-Lago estate, with attendees including government officials, traditional bank executives, and Binance's former CEO, CZ.
While the de-anchoring was brief, it exposed a structural problem: political endorsement can boost market capitalization, but it doesn't necessarily translate to resilience. When a stablecoin's biggest selling point is the name of the president's family, any attack on that name becomes an attack on the stablecoin itself.
Has the team started shipping?
About 10 days after the attack, another set of data appeared on the blockchain, which amplified the market's interpretation options once again.
On-chain analysis shows that starting March 4th, WLFI transferred a large number of WLFI tokens to centralized exchanges over two consecutive days: On the first day, approximately 146.4 million WLFI were transferred to OKX and Bitget, equivalent to about $15.4 million at the time; on the second day, approximately 16.71 million WLFI were transferred to OKX, equivalent to about $1.74 million. The two transfers totaled approximately 163 million tokens, with a total value exceeding $17 million.
In the on-chain world, transferring tokens to centralized exchanges is often seen as a highly signaling action, usually implying a potential selling intention. While not all transferred tokens will be immediately converted into cash, the act itself is enough to trigger associations and vigilance among market participants, especially given the multiple pressures facing the project.
This association seems particularly reasonable at the current juncture. The USD1 stablecoin just experienced a brief de-pegging event on February 23, 2026, with its price briefly falling to around $0.994, and even touching $0.98 at times. Although the price recovered to nearly $0.998 within hours, this event has exacerbated external doubts about the robustness of the WLFI project.
Meanwhile, the political controversy surrounding WLFI continues unabated. The U.S. House of Representatives launched an investigation on February 4, 2026, demanding that WLFI provide ownership records, fund flows, governance documents, and details of board changes. The focus is on a deal involving Sheikh Tahnoon bin Zayed Al Nahyan, a member of the Abu Dhabi royal family, who, through his controlled company Aryam Investment 1, secretly acquired approximately 49% of WLFI's shares for $500 million (signed on January 16, 2025, four days before Trump's second inauguration), with a deadline of March 1, 2026. Furthermore, Senators Elizabeth Warren and Andy Kim, emphasizing national security risks and potential conflicts of interest, requested the Treasury Department's CFIUS to review the transaction on February 13.
It's worth noting that WLFI has not issued any public statement regarding these on-chain transfers. This silence itself has become part of the market's interpretation.
Of course, another interpretation also holds true: the project is strategically positioning itself to manage liquidity on the CEX in preparation for subsequent market operations; or, this is a pre-planned liquidity management action within the token's economic design, unrelated to the external environment. Neither narrative can be completely ruled out, which is precisely the most paradoxical aspect of on-chain data—it provides facts, but not intentions.
However, according to WLFI's operating agreement, entities controlled by the Trump family receive 75% of the project's profits. DT Marks Defi LLC, Trump's holding entity, owns approximately 60% of WLFI, and members of the Trump family and their affiliates have been allocated approximately 22.5 billion WLFI tokens. Any market movements of these tokens represent not only financial decisions at the project level but also the family's path to monetizing assets in the crypto market.
Currently, the price of WLFI tokens has fallen by more than 50% from its all-time high. At this juncture, any large-scale transfers will inevitably be re-examined in the context of this decline.
The President's Other Battle in Washington
On March 4, Trump posted on Truth Social, using more urgent language than usual. He specifically criticized the banking industry for threatening and weakening the GENIUS Act, demanded that Congress expedite the passage of the crypto market structure bill, and warned that if the United States is slow to act, its crypto advantage will be handed over to other countries.
This rhetoric is not unfamiliar—packaging domestic policy disputes as great power competition and portraying those who oppose them as traitors. Trump has used it many times, and it has always worked.
He was speaking out for the industry, and he was also speaking out for himself. It's just that these two things were packaged together in the same sentence.
The GENIUS Act itself is not complex. It is the first bill in U.S. history to establish a federal-level regulatory framework for stablecoin issuance, clarifying issuance qualifications, reserve requirements, and anti-money laundering obligations. After several rounds of revisions, it was signed into law in 2025. The direction is good; the controversy lies in the details.
The banking lobby is focusing on one clause: whether stablecoins can offer returns to holders. The logic is straightforward—if stablecoins can pay interest, why would people keep their money in banks? Deposit outflows are the last thing the banking industry wants. So the lobbying groups began lobbying to change the relevant clauses, while simultaneously extending this resistance to another piece of crypto legislation, the Clarity Act, creating a binding agreement: if you want stablecoin legislation, you have to agree to my conditions first.
Trump's reaction was to directly lash out at the banking industry on social media. This stance sends a signal: the legislative process is not going smoothly. A truly confident advocate doesn't need to exert pressure through online posts. His need to post indicates that he doesn't have enough leverage at the negotiating table.
But what truly complicates this game is not the resistance from the banking sector, but a gap in the text of the GENIUS Act.
This law contains no provisions restricting the president or his family members from profiting from the issuance of stablecoins. This gap sparked controversy during the legislative process, with some senators attempting to include relevant prohibitions, but ultimately none were included. This resulted in a peculiar structure: a president who is both the driving force and a potential beneficiary of legislation, and who can also exercise veto power if the legislation affects his own interests—this closed logical loop may be the deepest underlying characteristic of this Washington power struggle.
Conclusion: The intersection of two lines
Putting the above three events on the same timeline: On February 23, USD1 suffered a coordinated attack after being de-pegged, but quickly recovered; a few days after the attack, WLFI transferred a large number of tokens to CEX for two consecutive days; on March 4, Trump posted on Truth Social, launching a direct counterattack against the banking industry that was blocking the GENIUS Act.
These three events occurred in less than two weeks. Although there is no simple causal relationship between them, the protagonists are the same family—the crypto empire of the current US President Trump: on one hand, the family's projects are facing real pressure in the market, whether it is external attacks, opaque on-chain actions, or political investigations from Congress; on the other hand, the president is using the greatest resources he can mobilize—the White House's discourse power and political credibility—to legislate to protect stablecoins.
The intersection of these two lines is Trump himself. He is not switching between his identity as a businessman and his identity as president; he is fighting on two battlefields simultaneously, and both battlefields are pointing in the same direction: to keep USD1 and WLFI alive, and to make them legitimate, scaled, and profitable within a regulatory framework that he personally promoted.
Questions about this overlap have been ongoing and intensified significantly in early 2026. An investigation led by Representative Ro Khanna focused on the UAE royal family's secret $500 million acquisition of approximately 49% of WLFI, questioning the flow of funds, governance transparency, and potential national security risks—particularly given that shortly after the UAE royal family's investment in WLFI, the Trump administration approved a plan to export hundreds of thousands of advanced chips to G42, a company owned by UAE Tahnoun, despite this decision having previously been shelved on national security grounds.
Legal scholars have called the deal a potential constitutional violation (breaking the constitutional clause prohibiting the president from accepting gifts from foreign entities). The White House responded that Trump himself has never been involved in any WLFI transactions or decisions and has maintained a distance from the company since taking office.
This argument may hold true from a legal perspective, but in reality, it describes a state of isolation that is almost impossible to verify independently from the outside. When a president's family's businesses continuously appreciate in value through favorable policies, and the president himself continues to create favorable policies for this industry, the existence of interests and the validity of any connection become a structural gray area.
The deeper issue isn't whether Trump broke the law, but whether the existing system has sufficient tools to handle this new type of power-business overlap. Stablecoins are an industry highly dependent on regulatory clarity, and when the very drivers of that clarity are market participants, the very rule-making process becomes a subject that needs to be re-examined.
Trump's two hats are no longer a secret he's deliberately hiding. They exist to some extent in the open, constantly being watched by the market, the media, and some members of Congress.
Its continued operation is precisely because the mechanisms that theoretically constrain it—congressional legislation, presidential signing, and regulatory rule-making—all have his hand present at every stage. The constraint mechanism itself is in the hands of the person who needs to be constrained.
