Is USD1 Safe? World Liberty's Stablecoin Lost $400 Million in Two Weeks — What the Redemptions Mean for Holders

What actually happened

CoinGecko data cited by Cointelegraph put USD1's market capitalization at about $4.02 billion on Monday, October 19, down from $4.43 billion on October 6: roughly $401 million, or 9.1%. When we pulled CoinGecko ourselves at 20:49 UTC on October 19 it showed a market cap of $4.008 billion and a price of $0.9989.

The more detailed numbers come from OnChain Benchmark, a blockchain research firm, which measured the nine days from the October 6 close to the October 15 close:

On Ethereum, more than 99% of the tokens sent for redemption passed through a wallet labeled BitGo, which is USD1's current issuer and custodian. Every redemption was executed by the same issuance contract, which receives the tokens and destroys them. In plain terms: someone handed back USD1 and got dollars, and the coin was removed from circulation. That is how a stablecoin is supposed to behave when a big holder leaves, and it is the opposite of a panic sale on an exchange, which would have pushed the market price below $1.

For context, OnChain Benchmark compared the same nine days on Ethereum: USD1's supply fell 11.45%, against 4.93% for USDe, 2.18% for USDC and 0.76% for USDT. So USD1 shrank faster than the big names, but the others also shrank. The whole stablecoin complex was a little smaller on Ethereum during a week when Bitcoin kept getting rejected near $83,000.

Did the peg hold? Our own check

Press reports say USD1 traded between $0.998 and $1.000 during the period OnChain Benchmark examined. We checked against live exchange data instead of repeating that: Binance's public API gives 14 daily candles for USD1/USDT from October 6 to October 19, 2026.

• The lowest daily low was $0.99858, on October 8.
• The highest daily high was $1.00055.
• The last trade on October 19 was $0.99981, with about $171 million of USD1/USDT traded on Binance in 24 hours.

A drift of 0.14% below par at the worst moment is within what every large stablecoin shows on any busy week. It is nothing like a depeg, and there was no day when the pair traded at a discount that would cost a holder real money. Two caveats belong in your own thinking, not in a disclaimer: Binance is one venue, and a pair quoted against USDT measures USD1 against another stablecoin, not against a bank dollar. If both moved together a price chart would hide it, which is why you also watch supply, reserves and the redemption path.

Why a $400 million drop still matters

A stablecoin's price stays at $1 because the issuer will exchange tokens for dollars at par. That promise is tested when large holders redeem, and October 6–15 was a live test that the redemption channel passed: hundreds of millions went out within days and the price barely moved. That is good news for anyone currently holding USD1.

The same data shows concentration. The BNB Chain redemptions came in blocks of $30–50 million from one address; OnChain Benchmark could not say who controls it or why it redeemed. For a $4 billion token, "a few holders can move supply by close to a tenth in under two weeks" is a fact about the holder base that the headline market cap does not show. If the same holders ever decided to sell on an exchange rather than redeem, the pair would be tested very differently.

There is also a change of issuer coming. World Liberty's trust company won conditional approval from the US Office of the Comptroller of the Currency in August and plans to take over issuance and custody of USD1 from BitGo. A community-bank trade group has asked a federal court to rein in that type of trust charter. OnChain Benchmark's summary is that the next weeks of supply data will show whether October marks the size USD1 carries into its new issuer, or just a dip. Nothing in the sources says the coin is impaired; they say the structure is about to change while its size is moving.

What to do if you hold USD1

1. Check the live price on the venue you will use, not on a price site. On Binance you can see USD1/USDT at a glance; for a larger amount, look at the order book depth before you sell, not only the last trade.
2. Know your redemption route. The on-chain redemptions in the table went through the issuer's contract, which is a route for large holders. For most people the practical exit is selling USD1 for USDC or USDT on an exchange, and the $171 million of 24-hour USD1/USDT volume on Binance shows that route is open.
3. Do not keep all your cash in one stablecoin. This is the lesson of every stablecoin story, not only this one. Splitting a balance between two issuers with different reserve setups costs you nothing in spot fees beyond a trade and removes the single point of failure.
4. Watch three numbers for the next weeks: the supply on each chain (OnChain Benchmark publishes it), the USD1/USDT price on a couple of venues, and any announcement from World Liberty about the issuer switch. A supply that keeps falling while the price stays at $1 is a quiet exit; a price below $0.995 is the signal that the exit is no longer quiet.
5. If you are trading, not parking. Use the trading pair with the lowest cost. Binance spot is 0.1% maker and taker on our fee table (checked October 10), and our rates page puts the fee tables of the major venues side by side so you can compare before you swap.

If you want to move out of USD1 or rebalance between stablecoins, a spot swap is a one-click job on a major venue. Binance, with invite code 11350287, carries an automatic fee rebate through NexuAlpha and quotes the USD1/USDT pair directly; Bitget with code nexu888 does the same for USDC and USDT spot pairs. See the Binance profile and the Bitget profile for fees and how the rebate settles,, and check the fee comparison before you size a swap.

USD1 versus a bank dollar, in one paragraph

A stablecoin is a claim on reserves held by an issuer; a bank deposit is a claim on a bank. If you want the longer version of that difference, including what "redemption" legally means, our explainer on stablecoins versus tokenized deposits walks through who owes you what. The practical takeaway today is narrower: the USD1 redemptions were processed, the token kept its price, and the open questions are about concentration and the coming issuer change, not about this week's solvency.

Quick answers

Is USD1 safe to hold right now? The data from October 6–19 shows a working peg and a working redemption channel: price between $0.9986 and $1.0006 on Binance, hundreds of millions redeemed without a break. The risks that remain are concentration among large holders and the planned switch of issuer from BitGo to World Liberty's own trust company.

Did USD1 depeg? No. Binance daily candles for USD1/USDT never traded below $0.99858 between October 6 and October 19, and OnChain Benchmark reported a $0.998–$1.000 range over its nine-day window.

How much supply did USD1 lose? About $401 million (9.1%) from October 6 to October 19 on CoinGecko's numbers, or $385.03 million (8.71%) from the October 6 close to the October 15 close on OnChain Benchmark's three-chain count: $184.60 million on Ethereum and $200.43 million on BNB Chain, with Solana unchanged.

Who redeemed? On Ethereum more than 99% of the redemptions went through a wallet labeled BitGo, the current issuer and custodian. On BNB Chain, $200.00 million of $200.50 million came from one address that OnChain Benchmark could not identify.

What happens when the issuer changes? World Liberty's trust company plans to take over issuance and custody from BitGo after conditional OCC approval in August; a bank trade group has challenged that kind of charter in court. Watch the supply and price data around the changeover.

Should I move to USDC or USDT? The data does not say you must. It says that holding a second stablecoin costs one spot trade and removes dependence on one issuer, and that exits are available while the price is at par.