World Liberty's USD1 Stablecoin Sheds $400 Million in Two Weeks as Redemptions Mount
Published October 20, 2026, 1:45 AM PKT. Based on World Liberty Financial's proof-of-reserves dashboard as of October 19, 2026 (primary source), Cointelegraph's October 19, 2026 report on the redemptions (secondary source), CryptoBreaking's report on Onchain Benchmark's October 2026 on-chain redemption analysis (secondary source), TradersUnion's October 19, 2026 report (secondary source), crypto-economy's October 19, 2026 report (secondary source), and DeFiLlama's USD1 stablecoin tracker data as of October 19, 2026 (secondary source). MABOnChain has not previously covered USD1's redemptions.
World Liberty Financial's USD1 stablecoin has shed more than $400 million of its market capitalization in two weeks, driven by concentrated redemptions on Ethereum and BNB Chain, while the token's dollar peg has held. CoinGecko data showed USD1's market capitalization at about $4.02 billion on October 19, down from $4.43 billion on October 6, a decline of approximately $401 million, or 9.1%, Cointelegraph reported on October 19.
"One unidentified address": the $200 million BNB Chain redemption
The supply contraction was concentrated on two blockchains. Blockchain research firm Onchain Benchmark found that between October 6 and October 15, Ethereum accounted for about $184.60 million of net USD1 redemptions across 63 token burns, while BNB Chain recorded about $200.43 million across 12 burns, CryptoBreaking reported, citing the research. On BNB Chain, nearly $200 million of the redemptions originated from a single unidentified address, the researchers said, without establishing who controls the funds or why they were redeemed.
On Ethereum, more than 99% of the tokens sent for redemption passed through a wallet labeled BitGo, USD1's current issuer and custodian, according to Onchain Benchmark's analysis.
The peg held at $0.998 to $1.000
Despite the supply contraction, USD1 maintained its dollar peg throughout the period examined by Onchain Benchmark, trading between $0.998 and $1.000, and the researchers found no evidence of a sustained depegging event, Cointelegraph reported. World Liberty Financial's proof-of-reserves dashboard separately showed approximately $4.01 billion in backing assets, in line with the $4.02 billion circulating market capitalization reported by CoinGecko.
DeFiLlama's stablecoin tracker put USD1's market capitalization at $4.039 billion as of October 19, spread across eight chains, with the largest share, $1.405 billion, on Ethereum.
A sharper drop than USDT, USDC and USDe
The contraction outpaced declines in rival dollar-pegged stablecoins. TradersUnion reported that USD1's roughly 11.45% supply drop outpaced the declines seen in USDe, USDC and USDT over the same stretch. Issuance on Solana, near $1.42 billion, did not compensate for the reductions on Ethereum and BNB Chain, CryptoBreaking reported.
The Trump-family stablecoin, facing an issuer transition
USD1 is issued by World Liberty Financial, the crypto project backed by Donald Trump's family. TradersUnion noted the contraction is coming ahead of a planned issuer transition at the project. The token is backed by U.S. Treasuries and cash equivalents, according to DeFiLlama's classification of the stablecoin as fiat-backed.
This article is news reporting and is not investment advice.
Sources
- World Liberty Financial proof-of-reserves dashboard, as of October 19, 2026, primary source: approximately $4.01 billion in backing assets, matching the reported circulating market capitalization
- Cointelegraph, October 19, 2026, secondary source: CoinGecko data showing USD1 market capitalization at about $4.02 billion on October 19 versus $4.43 billion on October 6, a decline of approximately $401 million or 9.1%; Onchain Benchmark findings of concentrated redemptions on Ethereum and BNB Chain; nearly $200 million redeemed from a single unidentified address on BNB Chain; peg held at $0.998 to $1.000 with no evidence of a sustained depegging event
- CryptoBreaking, October 2026, secondary source: Onchain Benchmark's breakdown of $184.60 million in net Ethereum redemptions across 63 burns and $200.43 million on BNB Chain across 12 burns between October 6 and October 15; more than 99% of Ethereum redemptions routed through a BitGo-labeled wallet, USD1's current issuer and custodian; Solana issuance near $1.42 billion not compensating for the reductions
- TradersUnion, October 19, 2026, secondary source: USD1's approximately 11.45% supply drop outpacing declines in USDe, USDC and USDT; contraction coming ahead of a planned issuer transition
- crypto-economy, October 19, 2026, secondary source: market capitalization figures, redemption concentration on Ethereum and BNB Chain, maintained dollar peg
- DeFiLlama USD1 stablecoin tracker, as of October 19, 2026, secondary source: market capitalization $4.039 billion across eight chains, $1.405 billion on Ethereum; fiat-backed classification backed by U.S. Treasuries and cash equivalents, with minting and redemption through the issuer's managed process
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