World Liberty Financial: A Controversial Crypto Project by the Trump Family

World Liberty Financial: A New Crypto Venture by the Trump Family

World Liberty Financial, a recently launched crypto lending platform, is being promoted by former U.S. President Donald Trump and his sons, aiming to “put the power of finance back in the hands of the people.” The platform claims to offer a solution to the perceived inequities of the traditional finance system.

A draft white paper obtained by CoinDesk reveals some intriguing details about the project. It indicates that a staggering 70% of WLFI, the governance token for World Liberty Financial, will be controlled by a select group of insiders, including the founders, team members, and service providers. In contrast, only 30% of the token supply is earmarked for public sale, part of which will also benefit project insiders. Some of the raised funds will be allocated to a treasury meant to support the operational needs of World Liberty Financial.

This high allocation to insiders raises eyebrows, especially as the crypto space typically favors more equitable distributions. For comparison, Ethereum’s Genesis block allocated just 16.6% of ether (ETH) to the Ethereum Foundation and early contributors, while the three firms behind Cardano retained a combined 20% at launch. The creator of Bitcoin, Satoshi Nakamoto, is estimated to hold slightly over 5% of Bitcoin’s total supply. One industry insider, when questioned about the 70% allocation to insiders, humorously remarked, “LMAO. nice joke ser.”

As of now, World Liberty Financial has yet to finalize its operational plans, according to sources close to the project. This comes on the heels of a CoinDesk report that revealed the involvement of the Trump family and individuals associated with a recently hacked crypto application in the project’s development. Reports also confirm that World Liberty Financial will be built on Aave, a well-known Ethereum-based lending platform.

The allocation strategy prompts speculation about whether this venture is more about leveraging the Trump family’s notoriety than genuinely advancing decentralized finance (DeFi). Typically, proceeds from pre-sales are reinvested into projects to foster growth. If insiders intend to retain most of the funds for themselves, questions arise about how they will fulfill their ambitious promises.

Among these promises is the goal of establishing the U.S. as the “crypto capital of the planet.” In a Telegram post, the World Liberty Financial team reassured skeptics that their “plan will speak for itself,” boasting that the project is backed by “the brightest minds in crypto” and urging doubters to reconsider their stance.

They further emphasized their commitment: “Our mission is crystal clear: Make crypto and America great by driving the mass adoption of stablecoins and decentralized finance. We believe that DeFi is the future, and we’re committed to making it accessible and secure for everyone.”

In the current crypto landscape, public token pre-sales are becoming increasingly rare, largely due to the decline of initial coin offerings (ICOs), which once served as a primary fundraising method for crypto startups. The fall from grace of ICOs can be attributed to heightened regulatory scrutiny, rampant fraud, and the emergence of alternative fundraising models that provide greater oversight and investor protections.

World Liberty Financial’s approach deviates from traditional ICOs in that the WLFI token will be non-transferable, preventing trading between users. This strategy appears designed to shield World Liberty Financial from potential securities law violations. According to the white paper, “All $WLFI will be non-transferable and locked indefinitely in a wallet or smart contract until such time, if ever, $WLFI are unlocked through protocol governance procedures in a manner that does not contravene applicable law.”

Recent revelations have also highlighted World Liberty Financial’s connections to Dough Finance, a lending app that was recently hacked, with its founders including Zak Folkman, a former pick-up artist and entrepreneur who is officially registered as the owner of World Liberty Financial LLC.

While Donald Trump seems to envision World Liberty Financial as a bridge to the blockchain community, some of his supporters within the industry caution that the initiative could backfire. Nic Carter, a notable figure in the crypto space and a Trump supporter, raised concerns on X (formerly Twitter), asking, “Is there something that we, as crypto twitter, can collectively do to stop the launch of world liberty coin?”

Carter elaborated, stating, “I think it genuinely damages Trump’s electoral prospects, especially if it gets hacked (it’ll be the juiciest DeFi target ever and it’s forked from a protocol that itself was hacked). It’s also an obvious target for the SEC. At best, it’s an unnecessary distraction; at worst, it’s a huge embarrassment and source of (additional) legal trouble. So are we signing a petition or what?”

As World Liberty Financial prepares for its launch, it has already caught the eye of fraudsters and hackers. Recently, the X accounts of Eric Trump’s wife, Lara Trump, and Trump’s youngest daughter, Tiffany Trump, were compromised and used to promote a crypto scam masquerading as World Liberty Financial.

Donald Trump is officially designated as the project’s “Chief Crypto Advocate,” while his two oldest sons, Don Jr. and Eric, serve as “Web 3 Ambassadors.” Barron Trump, the former president’s 18-year-old son, holds the title of “DeFi Visionary” for World Liberty Financial.

Despite the Trump family’s significant involvement in promoting and launching the project, the white paper emphasizes a lack of political affiliation. It states, “World Liberty Financial is not owned, managed, operated, or sold by Donald J. Trump, the Trump Organization, or any of their respective family members, affiliates, or principals. However, they may own $WLFI and receive compensation from World Liberty Financial and its developers. World Liberty Financial and $WLFI are not political and have no affiliation with any political campaign.”

Danny Nelson contributed reporting to this story.