Binance's 20% Yield Boost Fuels Trump-Linked Stablecoin's Rise

Binance has launched a yield program offering up to 20% annual percentage yield (APY) on deposits of its USD1 stablecoin, which is linked to the Trump family's World Liberty Financial (WLFI) enterprise. The promotion, running until January 23, 2026, has led to a $150 million increase in USD1's market capitalization, bringing it to $2.89 billion. The program targets deposits exceeding $50,000, offering tiered rewards distributed daily to Binance users.

The Trump-linked stablecoin, now the seventh-largest in the world by market capitalization, has seen rapid adoption due to Binance's strategic integration. The exchange has introduced fee-free trading pairs and pledged to convert all assets backing its Binance USD (BUSD) into USD1 at a 1:1 ratio. These moves highlight Binance's commitment to embedding USD1 into its ecosystem.

In May 2025, USD1 was used to settle a $2 billion investment by MGX into Binance Exchange, as publicly noted by Eric Trump. This transaction positioned USD1 as a key player in major crypto deals. Binance's ongoing support has helped USD1 grow despite regulatory and political scrutiny.

The Trump family's broader crypto ventures reportedly generated $802 million in revenue during the first half of 2025, underscoring the scale of their digital assets strategy. The Trump-linked stablecoin has drawn attention from both investors and regulators, with questions surrounding its ties to Binance. A Bloomberg report in July suggested that Binance contributed to some of USD1's codebase, a claim Binance founder Changpeng Zhao denied as inaccurate.

The political dimension of the stablecoin has further intensified scrutiny. Connecticut Senator Chris Murphy criticized Binance.US for promoting Trump-linked crypto, following a presidential pardon for Binance's owner by Donald Trump. These developments have raised concerns about conflicts of interest and the influence of political connections in the crypto industry.

How Markets Reacted

Despite the controversies, USD1 has climbed to become the seventh-largest stablecoin globally. Binance's fee-free trading pairs and the replacement of BUSD with USD1 have strengthened the token's liquidity and usability. The yield program is expected to attract long-term holders seeking high returns, especially as traditional financial instruments offer low or negative yields.

Binance's aggressive promotion of USD1 reflects its broader strategy to expand its ecosystem and attract new investors. The exchange has positioned USD1 as a competitive alternative to other stablecoins, leveraging its association with high-profile figures and its integration into major transactions. The yield-driven approach has driven rapid inflows and market value appreciation in a short period.

What Analysts Are Watching

The sustainability of USD1's growth remains a key concern. While high APY programs can drive short-term inflows, their effectiveness diminishes once promotional periods end. Analysts will closely monitor whether the token retains its market position as yield incentives decline. Organic usage beyond yield farming and exchange-driven activity will be a critical factor in its long-term success.

Regulatory clarity is also under focus. As USD1 continues to rise, regulators are expected to scrutinize its governance, issuance, and relationships with exchanges. Questions about the codebase and the extent of Binance's involvement could influence investor confidence and market stability. A transparent and compliant framework will be essential to maintaining USD1's standing in a competitive market.