Currency $USD1

World Liberty Financial, a decentralized finance company backed by President Donald Trump and his family, has launched a stablecoin to join a market that is becoming increasingly crowded.

The company announced on Tuesday that the stablecoin, named USD1, will be pegged to the US dollar and will be backed by short-term US Treasury bonds, US dollar deposits, and equivalents in other cash currencies. It will soon be available on the Ethereum and Binance Smart Chain networks.

Co-founder Zack Witkoff stated: "USD1 provides what algorithmic and anonymous cryptocurrency projects do not - access to the power of decentralized finance (DeFi)."

The market capitalization of dollar-backed stablecoins - which are digital currencies that guarantee a fixed peg to another asset - has reached its highest level ever this year, growing by more than 46% over the past year, according to Crypto Quant. Currently, Tether (USDT) and Circle's USDC dominate these digital assets, which are considered 'systemically important,' and are widely used in trading on centralized and decentralized exchanges, as well as collateral in decentralized finance. Cryptocurrency investors closely monitor stablecoins for signs of demand, liquidity, and market activity.