On Monday, World Liberty Financial (WLFI), a decentralized finance project backed by President Donald Trump, announced a proposal to distribute a small amount of its newly launched USD1 stablecoin to all eligible WLFI token holders. 

The test, the company wrote, would “validate the technical functionality of its airdrop system in a live environment while thanking early supporters of the project.”

Framed as a test of its on-chain airdrop system, the proposal seeks to reward early adopters and boost “visibility and awareness” of its stablecoin USD1 before full-scale deployment.

“Testing the airdrop mechanism in a live setting is a necessary step to ensure smart contract functionality and readiness,” the proposal said.

The exact airdrop amount and timing are still being finalized, though it will occur on Ethereum Mainnet and be funded by WLFI.

“Even if approved, World Liberty Financial, Inc. reserves the right to discontinue, suspend, modify, or terminate the test airdrop at any time as well as to establish any additional eligibility requirements,” the Trump-linked firm wrote.

WLFI’s proposal also lays out a detailed plan including community discussion, finalization of the airdrop amount and execution method, a governance vote, and finally, public announcement of the distribution. 

The voters are offered three options: Yes, No, or Abstain, with the majority having selected ‘Yes’ since the proposal was posted 7 hours ago.

WLFI’s Political Ties Trigger Backlash 

Since WLFI launched USD1 in late March, just as Congress began debating the bipartisan STABLE Act, lawmakers have sounded alarms over Trump’s financial stake in the project, warning it could compromise the integrity of the regulation.

WLFI, launched last September, has already raised $550 million through token sales, with $390 million reportedly paid out to Trump family-linked entity DT Marks DEFI LLC. 

The firm’s stablecoin USD1 is collateralized by U.S. Treasuries and managed by custodian BitGo, but the platform’s governance token remains non-transferable, adding to concerns over transparency and decentralization.

Tensions exploded during a recent House Financial Services Committee markup of the bill as  Democrats pushed for amendments that would bar sitting presidents, cabinet members, and their families from launching stablecoins while in office.

Meanwhile last week, Sen. Elizabeth Warren (D-MA) and Rep. Maxine Waters (D-CA) demanded the U.S. Securities and Exchange commission (SEC) to turn over all internal records related to WLFI, citing potential “regulatory favoritism” and the agency’s decision to pause enforcement actions, including one involving WLFI investor and Tron founder Justin Sun.

Users of popular payments apps PayPal and Venmo will soon be able to buy, sell, hold, and transfer Solana and Chainlink from directly inside their accounts alongside leading cryptocurrencies Bitcoin and Ethereum. 

PayPal said that adding the new coins, which are both among the top 15 most valuable cryptocurrencies by market cap respectively according to data from CoinGecko, reflects the company’s “dedication to the evolving digital currency landscape.”

“Since we initially made cryptocurrencies available on PayPal and Venmo, we’ve been listening to our users about what they want to do with crypto on our platforms,” said May Zabaneh, PayPal’s VP of product, blockchain, crypto and digital currencies in a statement.

“Offering more tokens on PayPal and Venmo provides users with greater flexibility, choice, and access to digital currencies,” she added. “This allows for more options to buy, send, or spend within our trusted PayPal and Venmo wallets.”

Access to Chainlink and Solana purchases will roll out to users in-app “over the next few weeks.” 

PayPal began allowing users to buy, sell, or hold Bitcoin and Ethereum directly in 2020 and has since made moves to advance its crypto product offering, later expanding capabilities to its popular Venmo mobile payments app.

Since that time, the firm has gradually expanded its crypto footprint, launching its own dollar-pegged stablecoin (PYUSD) on Ethereum in 2023 before expanding it to Solana. 

In September 2024, business account owners were granted the ability to buy, sell, and hold assets directly via their accounts, piggybacking on a trend of businesses and institutions cozying up to the largest crypto assets. That announcement was preceded by a feature addition that allowed users to send crypto via PayPal and Venmo using the Ethereum Name Service (ENS).

More recently, the company teamed with crypto payments platform MoonPay, allowing users of Venmo to utilize their balance, bank, or debit card to purchase any cryptocurrency via MoonPay’s payment rails. The same feature was added in PayPal as early as May 2024. 

PayPal recently stated a goal of having 20 million merchants using its PYUSD stablecoin by the end of 2025. Around the time of that announcement, shares in the company were trading around $77, but its PYPL stock has slid to $58.47 at the time of writing, marking a loss of around 32% year-to-date. 

Solana and Chainlink are both up in the last 24 hours, gaining 5.2% and 1.4% respectively.

Edited by Andrew Hayward

Banks can engage in cryptocurrency and other legally permitted activities without seeking prior regulatory approval, so long as they manage risks appropriately, The Federal Deposit Insurance Corporation announced Friday.

The policy change rescinds a 2022 requirement that mandated FDIC-supervised institutions notify the agency before engaging in crypto-related activities. Under the new guidance, banks can offer services involving digital assets without the agency’s advance permission.

“With today’s action, the FDIC is turning the page on the flawed approach of the past three years,” FDIC Acting Chairman Travis Hill said in a statement. “I expect this to be one of several steps the FDIC will take to lay out a new approach for how banks can engage in crypto and blockchain-related activities in accordance with safety and soundness standards.”

The move aligns with similar actions by the Office of the Comptroller of the Currency, which earlier this month reaffirmed that national banks can engage in certain crypto activities, including custody services and stablecoin transactions.

This regulatory shift marks a stark departure from the Biden administration’s approach to cryptocurrency and banking relationships. Documents released earlier this year through Freedom of Information Act requests showed the FDIC frequently deterred banks from offering crypto-related services, critics claimed.

The previous regulatory stance had drawn criticism from lawmakers who started investigations into what some called “Operation Chokepoint 2.0,” a reference to an Obama-era initiative that targeted certain industries including firearms dealers and payday lenders. Critics claimed the Biden administration had similarly targeted the cryptocurrency industry through banking restrictions.

In its new Financial Institution Letter (FIL-7-2025), the FDIC clarified that “FDIC-supervised institutions may engage in permissible crypto-related activities without receiving prior FDIC approval.”

The reversal follows months of pressure from cryptocurrency advocates and completes a significant pivot in federal banking policy. Industry representatives had accused regulators of using informal pressure tactics, including concerns about “reputational risk,” to discourage banks from serving cryptocurrency businesses.

American Bankers Association President and CEO Rob Nichols praised the decision. “We welcome FDIC’s new guidance allowing supervised institutions to engage in permissible crypto-related activities without receiving prior FDIC approval,” he said in an official statement. “America’s banks are actively evaluating ways to compete safely and responsibly across the financial services ecosystem, and this type of regulatory clarity is critical to enhancing innovation in the space.”

The FDIC emphasized that banks still need to consider various risks associated with crypto activities, including market and liquidity risks, operational and cybersecurity concerns, consumer protection requirements, and anti-money laundering obligations. The agency noted that institutions “should engage with their supervisory team as appropriate” when pursuing such activities.

Friday’s announcement comes as part of a broader effort by the Trump administration to remove hurdles for digital assets. Besides the OCC’s actions, the government is pushing for a crypto reserve, and taking actions to boost the local crypto ecosystem.

While cryptocurrency advocates welcomed the policy reversal, challenges remain for the industry—which, as consequence, means not everyone is excited with this regulatory shift. “Holy shit, the next Wall St. crash is going to make us long for the good ol’ days of the Great Depression,” said Justin Rosario, host of the political podcast “The Opinionated Ogre.”

Others expressed concerns about the abruptness of the change. “FDIC announces robust new requirement to engage in crypto activities: you must pinky swear,” bank advisor and expert Donald F. Billings wrote on LinkedIn.

The FDIC regulates and insures banks that hold trillions of dollars in deposits. Its new stance could potentially unlock significant capital flows into the cryptocurrency sector as banks reassess their ability to serve digital asset companies and offer crypto-related products to customers.

Edited by James Rubin