World Liberty Financial (WLFI) has implemented a real-time, on-chain proof-of-reserve system for its $4.7 billion USD1 stablecoin.
This represents a pivot from the stablecoin’s monthly attestation reports following a recent security breach and market panic that briefly broke the asset’s dollar peg.
USD1 Stablecoin Adopts Live Chainlink Tracking to Soothe Market Jitters
The crypto protocol, which maintains close ties to President Donald Trump’s family, announced the upgrade on February 27.
The new system integrates the Chainlink Runtime Environment to continuously pull, validate, and write reserve data from crypto custodian BitGo.
As a result, USD1 users can now monitor the stablecoin’s total supply, reserve backing, and live collateralization ratio across five networks, including Ethereum, Solana, and BNB Chain.
Real-time proof of reserves confirms the existence of $4.7 billion in short-term U.S. government treasuries and cash equivalents at BitGo.
However, industry analysts caution that the dashboard still provides limited granularity.
The continuous data feed does not automatically reveal the immediate liquidity profile of the underlying assets during a bank run. It also fails to shield the protocol from future vulnerabilities in its smart contracts or executive security practices.
This is because the upgrade arrives just days after USD1 lost its $1 peg and briefly slipped to a low of $0.994.
The WLFI team attributed the de-pegging to a “coordinated attack.” They alleged that malicious actors hacked multiple co-founder accounts, paid influencers to generate panic, and opened short positions against the protocol’s native token.
However, the reliance on a “coordinated attack” narrative has drawn scrutiny. The admission that multiple executive accounts were compromised exposes severe operational security vulnerabilities in a protocol that manages billions in institutional capital.
Furthermore, the project’s unprecedented political connections inherently attract elevated regulatory attention and adversarial market behavior, raising the stakes for its security infrastructure.
Despite the operational failures, USD1 appeared to have avoided a catastrophic collapse because its core redemption mechanism remained functional.
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