USD1 market capitalization surpasses $5 billion, TRUMP Meme coin plummets 94%, funds are flowing into "liquid" stablecoins

January 29 News: The USD1 stablecoin related to the Trump camp has surpassed a market capitalization of $5 billion, while the official Meme coin TRUMP has fallen over 94% from its peak. This stark contrast is revealing a shift in the crypto market’s capital flow: from high-volatility, narrative-driven tokens to more stablecoin infrastructure with better yield and compliance attributes.

Data shows that USD1, launched by World Liberty Financial, has risen to become the fifth-largest stablecoin globally within less than a year of its launch. At the same time, the TRUMP token based on the Solana ecosystem has dropped from about $75 to $4.66. Donald Trump Jr., co-founder of World Liberty Financial, stated that USD1 is focused on “infrastructure first” and is being adopted by institutional-grade users.

The rapid expansion of USD1 coincides with the company’s application to the U.S. Office of the Comptroller of the Currency (OCC) to establish a national trust bank. If approved, the World Liberty Trust Company will be responsible for issuance, custody, and reserve management under federal regulation, providing higher compliance backing for USD1.

This stablecoin previously gained attention due to a $2 billion institutional investment. Despite concerns raised by some U.S. lawmakers about potential conflicts of interest and security risks, World Liberty Financial continues to promote USD1’s integration into mainstream crypto infrastructure and expand cross-border use cases.

In contrast, the TRUMP Meme coin quickly declined after losing popularity. Narek Gevorgyan, founder of CoinStats, pointed out that the market is re-evaluating the difference between “usability” and “hype.” Peter Chung of Presto Labs believes that this decline is not exclusive to politics but is a common lifecycle for high-risk, narrative-driven tokens.

Since the establishment of the “GENIUS Act,” which sets the regulatory framework for USD stablecoins, the entire stablecoin sector has continued to grow. Currently, the total market cap of USD-pegged stablecoins exceeds $312 billion. The rise of USD1 and the decline of TRUMP reflect a trend where crypto capital favors low-volatility, settled, and custodial real-world applications.