Donald Trump’s Recent Venture into the Cryptocurrency Market

Donald Trump’s recent venture into the cryptocurrency market with World Liberty Financial has sparked debate about his intentions.

Donald Trump’s recent venture into the cryptocurrency market with World Liberty Financial (WLFI) has sparked debate about his intentions. Following the launch of USD1, a stablecoin pegged 1:1 to U.S. treasuries and cash equivalents on BNB Chain Testnet, investors are questioning the aim of this recent development.

According to Mateusz Kara, CEO of European crypto payment giant Ari10, this move is less about blockchain technology and more about fortifying the dominance of the U.S. dollar in global markets. In a statement issued Thursday, Kara expressed his concerns over key issues related to the new stablecoin.

“The real goal behind strengthening the stablecoin market is to turn the world into a more receptive marketplace for U.S. bonds,” said Kara.

According to Kara, platforms issuing stablecoins like USD1 must acquire USD and invest in treasury bonds. This creates a decentralized global system for distributing American debt, thus expanding the spread of the U.S. dollar. By increasing demand for U.S. dollars through stablecoins, the U.S. can borrow more affordably while expanding its financial influence.

However, Kara also highlighted the urgent need for the European Bloc to act quickly and strengthen its euro-based stablecoins or risk losing the market to the U.S., suggesting that the Old Continent is "already lagging behind."

Kara has been a big name in merging traditional finance with crypto adoption, especially in Europe. A staunch proponent of regulations like MiCA, he has played a crucial role in shaping Europe’s evolving crypto space. Now, he seems to be critical of the new stablecoin initiative launched by the Trump family’s venture, World Liberty Financial.

World Liberty Financial, a DeFi venture backed by the Trump family, has rapidly expanded its cryptocurrency holdings with regular acquisitions. The firm recently acquired 3.54 million Mantle (MNT) tokens after the Mantle network was upgraded, spending $3 million on the acquisition. This purchase follows a previous acquisition of 2.45 million MNT for $2 million in early March.

With this latest addition, WLFI’s total Mantle holdings now stand at close to 6 million tokens valued at around $5 million as of now. These acquisitions have been part of a broader plan to create a treasury of assets with high potential in the long term.

In addition to Mantle, WLFI has also invested steadily in other cryptocurrencies such as Ethereum (ETH), Wrapped Bitcoin (WBTC), Avalanche (AVAX), TRON (TRX), Chainlink (LINK), Athena (ENA), among others.

The company’s total investments across 11 tokens have been close $346 million. However, the firm currently faces a paper loss of $111 million, as its portfolio stands at $234.6 million. Despite its losses, WLFI continues to make strategic investments. Experts have analysed that these purchases may be a part of planned collaborations or reflect confidence in the market’s recovery in the long term.

Since the February market decline, WLFI has spent $28 million to acquire six assets, including Ethereum.