- USD1 briefly dropped to $0.994 after World Liberty Financial reported a “coordinated attack” involving hacked co-founder accounts.
- The crypto community questioned the incident’s legitimacy and also questioned why Eric Trump deleted several related tweets during the price disruption.
- The $5 billion stablecoin’s redemption mechanism helped the peg mostly recover despite ongoing controversy.
USD1, the US dollar stablecoin tied to World Liberty Financial, briefly traded below its US$1 peg on Monday after the project said it was targeted in a “coordinated attack.” Truly, a classic in the world of crypto.
According to an X post, the team behind USD1 said several cofounder accounts were hacked, influencers were paid to spread doubt, and traders opened short positions against the protocol’s WLFI token, and the goal was to trigger panic and profit from the price disruption.
However, people soon started asking questions, like, why is Eric Trump deleting tweets coincidentally at the time the attack happened? Others joked that the hacker was deleting Trump’s post, too, for some totally coincidental reason.
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WLFI Surrounded By Controversy, Again
The developers said the peg largely held because holders can redeem USD1 for US dollars through a redemption mechanism, which they said helped absorb selling pressure.
USD1’s market capitalisation is about US$5 billion (AU$7.6 billion), placing it among the larger dollar-pegged tokens but still behind the sector’s dominant issuers, including Tether’s USDT and Circle’s USDC.
CoinGecko data showed USD1 fell to US$0.994 at its lowest point, about 0.6% below its intended value. It later traded near US$0.998, still slightly under the peg.
It’s not the first time the project has been surrounded by controversy. A few weeks ago, it was reported that Aryam Investment 1, an Abu Dhabi entity linked to Emirati Sheikh Tahnoon bin Zayed Al Nahyan, acquired a 49% stake in WLFI just four days before Trump’s January 2025 inauguration.
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