World Liberty Financial (WLFI), a blockchain platform linked to Donald Trump, has made a significant $10 million investment in Falcon Finance to strengthen stablecoin infrastructure development, aiming to improve liquidity and interoperability between the two associated tokens.
The investment will be utilized by Falcon Finance to establish shared liquidity, multichain compatibility, and rapid conversion infrastructure between Falcon USD (USDf) and World Liberty Financial USD (USD1), a token launched by WLFI in March. USD1, associated with Eric Trump, will also be used as collateral on Falcon Finance. Notably, Eric Trump had previously announced that USD1 was used to settle MGX’s $2 billion investment into Binance Exchange during Token2049 in Dubai.
According to Zak Folkman, co-founder of World Liberty Financial, the partnership is designed to create a “more robust and flexible digital dollar infrastructure” for both retail and institutional participants. He further explained that Falcon’s overcollateralized model, combined with USD1’s reserve-backed framework, will help deliver a reliable synthetic dollar alternative for global use.
The announcement comes after a period of volatility for both stablecoins. On July 8, Falcon’s USDf dropped below its $1 peg, reaching a low of $0.9783, raising concerns among investors about its collateral quality. Although USDf regained its dollar parity by July 14, WLFI’s USD1 also experienced a decline, losing its dollar peg on Tuesday and falling to $0.9954. As of the time of writing, USD1 had not fully recovered, trading at $0.9993, according to CoinMarketCap data.
The growing involvement of the Trump family-linked blockchain platform in the crypto space has raised concerns among some industry watchers about the potential impact on emerging US blockchain legislation. A Bloomberg report indicated that crypto-related ventures have added at least $620 million to Trump’s net worth, estimated to be over $6 billion.
Meanwhile, the US Congress is experiencing deepening divisions regarding crypto legislation. Democratic Party members in the House of Representatives have announced a collective effort to oppose Republican efforts to pass what they deem “dangerous” legislation. House Financial Services Committee ranking member Maxine Waters has specifically criticized the Anti-CBDC Surveillance State Act and the CLARITY Act, stating that these bills lack necessary consumer protections and national security measures, and would make Congress complicit in what she termed “Trump’s unprecedented crypto scam.”
