World Liberty Financial has proposed allocating a small percentage of its unlocked treasury towards enhancing the growth of its stablecoin, USD1, intending to strengthen its influence within the cryptocurrency ecosystem.

The initiative suggests utilizing approximately 5% of WLFI’s treasury tokens, estimated to be around $120 million based on current market rates, to promote adoption and engagement with USD1 through strategic partnerships in both centralized and decentralized finance.

Enhancing USD1 Utilization

Since its debut in March, USD1 has seen a rapid increase, achieving a total value locked (TVL) of roughly $2.7 billion within just six months. WLFI has noted that this success is attributed to increasing community support and USD1’s integration into significant on-chain use cases, including trading.

The financial group argues that backing USD1 with WLFI treasury tokens will bolster its ecosystem, encourage wider adoption of the stablecoin, and generate new economic prospects for its token holders.

The proposal emphasizes the flagship status of USD1 for World Liberty Financial, whose growth is closely associated with the value and influence of the WLFI token. As the circulation of USD1 increases, the demand for WLFI-governed services and liquidity incentives is anticipated to grow, thereby expanding governance powers for WLFI holders regarding future project decisions such as product development and incentive structures.

To ensure transparency, the company promises to publicly disclose all partners receiving WLFI-based incentives on its website and communications. This proposal is currently open for governance voting.

May’s Meme Coin Boom

While USD1’s growth has been swift, some competitors in the stablecoin realm have not gone unnoticed. For instance, the PayPal-backed PYUSD boasts a market cap of $3.86 billion, surpassing USD1 by $1.1 billion. The 5% treasury allocation is designed to help close this gap by promoting the broader usage of the stablecoin across various platforms.

In May, early investors in USD1-linked meme coins on the BNB chain, particularly in the BUILDon project, reportedly experienced significant profits, with these tokens making up over 90% of daily meme coin trading activity.