A DeFi initiative linked in part to the family of US President Donald Trump has issued a warning to investors regarding counterfeit versions of its upcoming USD1 stablecoin.
On March 24, the project took to X (formerly Twitter) to declare alongside Changpeng Zhao (CZ) that the USD1 is not yet available for public trading. They urged potential investors to remain alert, stressing that any tokens labeled as USD1 currently in circulation are fraudulent.
The announcement included the statement:
“USD1 is not currently tradable. Beware of scams.”
This DeFi initiative aims to establish a decentralized ecosystem encompassing lending, borrowing, and stablecoin-based transactions.
Since February, the project has invested $28.6 million across six digital assets, including ETH, WBTC, MOVE, SEI, AVAX, and MNT.
However, despite this significant investment, the portfolio is showing an unrealized loss of $1.62 million, as reported by a blockchain analytics platform.
Emergence of counterfeit USD1 tokens
Although the initiative’s intentions for a stablecoin have been known for several months, the team had not publicly disclosed any specifics until speculation arose when former Binance CEO CZ acknowledged the USD1 smart contract on the BNB Chain.
Zhao noted that the token was deployed in early March and was in the testing phase.
A blockchain analysis firm reported that a well-known crypto market maker, Wintermute, was interacting with the token. On-chain data indicates that over $3.5 million worth of USD1 has already been minted.
However, this excitement has also drawn the attention of scammers.
Just hours after Zhao’s announcement, counterfeit tokens started surfacing across major networks like Solana, Ethereum, and BNB Chain. Data from a leading market tracker confirmed that various unrelated projects had adopted the same name to deceive investors.
In light of this, Zhao emphasized the importance of caution while reminding everyone that the official token from this initiative is not yet operational.
He stated:
“The official USD1 is not tradable yet. Please do not fall for the scams.”
Once launched, USD1 is expected to compete with leading dollar-pegged stablecoins such as Tether’s USDT, Circle’s USDC, and Ripple’s RLUSD.
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