Webot Risk Disclosure: World Liberty Financial (WLF) USD1 Stablecoin
IMPORTANT: PLEASE READ THIS DISCLOSURE CAREFULLY BEFORE TRADING OR HOLDING USD1 ON THE WEBOT PLATFORM. THIS IS A GENERAL RISK STATEMENT AND DOES NOT CONSTITUTE FINANCIAL, LEGAL, OR TAX ADVICE.
Users should be aware that transacting in any cryptocurrency, including stablecoins, carries substantial risk. You should not transact in a cryptocurrency if you are not familiar with that cryptocurrency or are unwilling to accept the risk of losing all of the money put into such assets.
Nature and Risk of USD1
USD1 is a digital asset token and while it is designed to function as a stablecoin pegged to the U.S. Dollar, its ability to maintain this peg is subject to specific, heightened risks, particularly regarding transparency and verifiability of its reserves.
- Lack of Verifiable Financial Audits: Unlike certain other major stablecoins (e.g., USDC), World Liberty Financial has not provided publicly available, comprehensive financial audits from a named, independent, Public Company Accounting Oversight Board (PCAOB) registered accounting firm that verify its reserves in a manner consistent with emerging U.S. regulatory standards (e.g., the GENIUS Act).
- Uncertain 1:1 Backing: While WLF claims USD1 is backed 1:1 by cash and short-term U.S. government securities held in custody by a regulated trust company (BitGo), the lack of published, regular, and independently verifiable attestations creates uncertainty about the actual composition and adequacy of these reserve assets at any given time.
- Potential for Unpegging and Volatility: Due to the potential lack of transparency in its reserve documentation, the market value of USD1 may not reliably hold its intended $1.00 peg. In periods of market stress, redemptions, or a general loss of market confidence, USD1 could become unpegged and experience significant volatility, similar to an algorithmic stablecoin or other speculative asset, resulting in substantial losses for holders.
- No Bank or Government Guarantees: USD1 is not money or legal tender, is not insured by the Federal Deposit Insurance Corporation (FDIC) or any other government entity, and carries no bank guarantees.
User Responsibility
Webot does not guarantee the performance of any investment or the return of any user’s principal.
By holding or trading USD1 on the Webot platform, you acknowledge and agree that:
- You understand the inherent risks associated with this specific asset, including the potential for significant loss.
- You have conducted your own due diligence and assume all risks associated with the transparency issues surrounding USD1’s financial backing.
- Webot will not be liable for any loss you suffer as a result of using or transacting in USD1.
- We encourage you to review the World Liberty Financial USD1 Risk Disclosures directly, and to consult with a qualified, independent financial adviser before making any investment decisions.