1. The Risk of "Super-Centralization"
Unlike other stablecoins (such as USDT or USDC), where Binance usually holds between 10% and 20% of the supply, USD1 is almost entirely concentrated on a single platform. This creates a single point of failure:
Operational Influence: If Binance decides to delist or change the rules of USD1, the project could collapse instantly.
Lack of Transparency: There is a gray area regarding whether these $4.7 billion belong to users or if they are part of the exchange's own strategic reserves.
2. The Power Triangle: Binance, Trump, and the United Arab Emirates
The scenario is complex due to political connections:
The Pardon of CZ: In October 2025, President Donald Trump granted a total and unconditional pardon to Changpeng Zhao (CZ) after he served time for failures in money laundering systems.
Investment from MGX: A sovereign fund from Abu Dhabi (MGX) injected $2 billion into Binance, and the entire operation was settled using USD1.
Conflict of Interest: Critics, such as Senator Elizabeth Warren, suggest that Binance's dominance in the Trump family stablecoin may be a form of "gratitude" or direct political influence.
3. Aggressive Incentives
To reach this 87%, Binance did not rely solely on luck. The exchange implemented:
Airdrops: Distribution of $40 million in WLFI tokens to those who maintained USD1 in their account.
Weekly Yield: Automatic rewards for holders of the currency on the platform.
Migration of BUSD: Binance converted old BUSD reserves directly to USD1, forcing liquidity into the new asset.
What Does This Mean for the Ecosystem?
The case of USD1 is becoming the "zero milestone" for new stablecoin regulations in 2026. If the currency fails or if there is evidence of political favoritism, the argument that the crypto market is "decentralized" will suffer a severe blow in the eyes of the public and regulators.
Curious Note: While global Binance holds billions, Binance.US (the American arm) holds only about $1,119 in USD1, suggesting that the use of the currency is massively driven by international investors rather than domestic U.S. users.
