World Liberty Financial (WLF), the DeFi project affiliated with former president Donald Trump and his family, is set to have its first token sale next week. According to its roadmap, the WLFI project intends to sell 20% of its tokens for $300 million at a fully diluted valuation of $1.5 billion.
The 20% sale only marks the first public sale of the WLFI tokens, as 63% of the token supply would be sold to the public. One of the co-founders, Zak Folkman, disclosed this on X Spaces, adding that the team gets 20%, while 17% is for user rewards.
According to the roadmap, the WLFI token would not be transferable for the first 12 months after the launch. This move to lock in the token for the year will likely prevent any speculative trading that could result in pump and dump until the project has found its roots.
However, WLFI, which also serves as the governance token for the DeFi platform, will have its full governance capabilities available immediately. Nevertheless, the community cannot vote on unlocking the tokens and enabling transfer, as any such vote will not be implemented until a year has passed.
With public sales set to commence, only accredited investors in the US and qualified investors in the UK can buy the token. The project blames the restrictions on outdated regulations and policies in the US, adding that all other investors outside the two countries can purchase the token.
WLFI plans to extend beyond DeFi
The WLF team has a grand plan for the project that could see it become an on-chain financial platform with many use cases. The leading one is a DeFi platform, as evident in the proposal to deploy a version of the Aave v3 protocol Ethereum Layer-2 network Scroll to provide stablecoin liquidity and onboard new users to DeFi.
In exchange, WLF is offering Aave DAO 7% of its tokens, worth $105 million, to be used by the DAO to participate in WLF governance and liquidity. The platform also offered 20% of all fees generated on its version of Aave v3 to the top lending protocol.
So far, the reaction to the proposal on Aave has been mixed. Some stakeholders, such as Aavechan Initiative founder, Marc Zeller, are in support as they believe this could contribute to adopting Aave and represent a new way to bring value to the protocol. However, some believe this is too risky given the people creating and backing the project, noting that this could just be a scam affecting Aave’s reputation.
A user said:
“I believe this proposal poses significant risk to the Aave protocol for little gain. I would encourage WLF to stand up their own fork / protocol independently and gain the trust of the crypto community.”
Still, the proposal is just a temperature check for the Aave DAO, and a decision might not happen soon.
However, WLF has other products on its roadmap. The second phase focuses on integrating the token with exchanges and creating a stablecoin-based credit card so that users can spend their tokens in the real world. In the third phase, WLF wants to become a platform for tokenizing and fractionalizing real-world assets in a regulatory-compliant manner and, later, a settlement for stablecoins.
Crypto community is still divided on WLF
While WLF is going ahead with its plan to create a DeFi platform, the reaction of many in the crypto community is still mostly skeptical. Most people in support of the project believe it could onboard a new category of users onto DeFi, which is much needed given how adoption has slowed.
However, the project backing from Trump and sons, who are named as Web3 advisors, as well as the antecedents of the co-founders, has left most people wary about the project. With tokens now locked for 12 months, many believe it could result in a monumental loss for investors, and some believe the token would not reach its expected valuation.
Still, the election outcome could majorly affect the project’s future. A Trump win will likely attract more users to the WLF and could even boost the token’s value.
