Ethereum News Today: Gate's Strategic Allocation of USD1 Surpasses $170M, Solidifying Second-Largest CEX Holding

Gate has solidified its position as the second-largest centralized exchange (CEX) holder of USD1, a USD-backed stablecoin developed by World Liberty Financial (WLFI). As of recent on-chain data, the platform holds approximately $170 million in USD1 on the Binance Smart Chain (BSC), securing its spot behind Binance. Additionally, Gate ranks first among CEXs for Ethereum-based USD1 reserves, with $20 million held on that chain. This development follows the successful launch of the IKA (IKA) token on Gate’s Launchpad on July 26, which incentivized users to subscribe using USD1 and Gate Token (GT). The campaign attracted over $200 million in USD1 and 5.33 million GT, valued at roughly $97.5 million, marking one of the largest commitments in Gate’s Launchpad history [1].

USD1, launched by WLFI, is collateralized 1:1 by short-term U.S. government treasuries, dollar deposits, and cash equivalents. Its multi-chain deployment on BSC and Ethereum aligns with growing demand for scalable, transparent stablecoins. Gate’s strategic allocation underscores a broader industry trend of CEXs diversifying stablecoin reserves to stabilize liquidity and reduce exposure to volatile assets. The exchange’s dual-chain approach—leveraging BSC’s scalability and Ethereum’s security—highlights a calculated effort to balance efficiency and trust in stablecoin operations.

The partnership between Gate and WLFI reflects a shared vision to bridge traditional finance with decentralized infrastructure. For USD1, the institutional backing from a major exchange like Gate could enhance its adoption, particularly amid increasing regulatory scrutiny of stablecoins. Gate’s role as a key liquidity provider positions it to amplify USD1’s utility across trading pairs and cross-chain use cases. Meanwhile, WLFI’s governance model, inspired by President Donald J. Trump’s vision, aims to democratize access to institutional-grade financial tools, potentially broadening participation in decentralized markets [2].

Industry observers note that this collaboration signals intensified competition among CEXs to dominate stablecoin markets. As USD1 vies for market share alongside USDT and USDC, exchanges are prioritizing stablecoin reserves to attract traders seeking low-risk collateral for staking and margin trading. Gate’s dual-chain strategy also underscores the sector’s evolving focus on interoperability, with platforms optimizing for both throughput and security. However, the absence of disclosed plans to expand USD1 holdings suggests the current allocation is a milestone rather than a precursor to aggressive expansion [1].

The move aligns with Gate’s broader ecosystem strategy, which includes Gate Wallet, Gate Ventures, and its 100% proof-of-reserves initiative. As a platform serving 33 million users and offering 3,600 digital assets, Gate’s emphasis on transparency and compliance reinforces its appeal to institutional clients. WLFI’s USD1, with its real-time audits and multi-chain deployment, complements these priorities while addressing concerns around stablecoin transparency.

[1] AMBCrypto, [https://ambcrypto.com/gate-and-world-liberty-financial-reach-strategic-milestone-gate-becomes-second-largest-cex-holder-of-usd1/](https://ambcrypto.com/gate-and-world-liberty-financial-reach-strategic-milestone-gate-becomes-second-largest-cex-holder-of-usd1/)

[2] U.Today, [https://u.today/press-releases](https://u.today/press-releases)