World Liberty Financial has launched World Liberty Markets, a DeFi lending platform using smart contracts for transparent lending terms. USD1 stablecoin is key, allowing users to access liquidity without selling assets. The project, linked to the Trump family, aims to expand onchain credit beyond crypto-native markets with tokenized real-world assets.

World Liberty Markets, backed by the USD1 stablecoin, offers onchain borrowing and lending. Interest rates update block by block, enforced by smart contracts visible on the blockchain. Supported collateral includes major cryptocurrencies and stablecoins, with plans to add tokenized real-world assets for broader credit access.

World Liberty Financial’s application for a national trust bank charter signals a long-term focus on regulatory compliance. The OCC approval could allow for custodial services and facilitate partnerships with traditional payment systems. The move reflects the industry trend towards regulated structures for blockchain-based financial services.

The evolution of crypto lending sees a shift towards decentralized models like DeFi protocols. With increased venture investment and developer activity, the market is maturing. Projects focusing on Bitcoin-backed lending and RWA tokenization are gaining traction, indicating a growing interest in onchain credit systems.

Despite the rising interest in onchain lending, risks remain, including smart contract vulnerabilities and market volatility triggering rapid liquidations. Overcollateralization limits access for users without substantial holdings, impacting financial inclusion. Expanding support for tokenized real-world assets presents challenges in verification, legal enforceability, and cross-border regulations.

Read more at CoinTelegraph: How World Liberty’s $3.4B USD1 Stablecoin Powers Onchain Lending Markets