Since the former US President Trump's full-fledged embrace of cryptocurrencies, the industry insiders who support Trump's pro-crypto rhetoric have become a common sight.
However, since entering September 2024, Trump's personal endorsement of the DeFi project World Liberty Financial, with him even occasionally posting on his official account with nearly 100 million followers to promote it, has still left industry insiders amazed.
Furthermore, well-known crypto institutions and projects have also been continuously drawn into it, such as Luke Pearson of Polychain Capital, Sandy Peng of Scroll, Ryan Fang of Tomo Wallet, and Rich Teo of Paxos, all of whom have become advisors or team members of World Liberty Financial.
On the evening of October 15, 2024, World Liberty Financial officially began its public sale, and the veil of World Liberty Financial has finally been lifted.
Jinse Finance reporters have delved into World Liberty Financial and summarized everything you need to know about World Liberty Financial.
What is World Liberty Financial?
According to the official information of World Liberty Financial, World Liberty Financial describes itself as: Inspired by Trump, promoting the mass adoption of stablecoins and DeFi, especially the US dollar stablecoin, to ensure the dominance of the US dollar. A key part of World Liberty Financial is to leverage the global influence and fame of the Trump brand to bring as many Web2 users as possible into the Web3 world.
Therefore, World Liberty Financial will be a DeFi platform where users can borrow and lend cryptocurrencies, create liquidity pools, and trade using stablecoins.
According to World Liberty Financial's proposal on the Aave governance forum, World Liberty Financial is requesting a temperature check on a motion to deploy an Aave V3 instance, which will allow four cryptocurrencies - USDC, USDT, ETH, and WBTC - to be used as collateral assets for borrowing. World Liberty Financial will provide 7% of its token supply (worth $105 million) to the Aave DAO for governance and liquidity provision, and will also provide 20% of the ongoing fees generated by its platform.
According to public information, the first phase of World Liberty Financial is to launch an Aave version on the Ethereum Layer 2 network Scroll, allowing users to lend and borrow tokens.
World Liberty Financial is deeply tied to the Trump family
When discussing World Liberty Financial, the outside world generally adds a prefix, which is "the Trump family-backed" World Liberty Financial.
The reason for this is that World Liberty Financial has a deep connection with the Trump family.
Trump has repeatedly posted on social media to promote World Liberty Financial and has referred to himself as the "Chief Crypto Advocate" of the World Liberty Financial project.
Trump's two elder sons, Donald Jr. and Eric Donald, are jointly serving as the "Web 3 Ambassadors" of World Liberty Financial, while his 18-year-old son Barron Trump is the "DeFi Visionary" of World Liberty Financial.
Although World Liberty Financial is deeply tied to the Trump family, from various signs, World Liberty Financial seems more like a white-label (OEM) product of the Trump family. The Trump family provides the brand and earns the profits, while unknown manipulators use the Trump family's reputation to launch the product.
This appears to be a common business operation for the Trump family. For example, Trump-named hotels or towers around the world are often collaborations with Trump in the form of licensing and OEM. In addition to real estate, Trump has also repeatedly licensed the Trump brand name to other fields such as perfumes, steaks, and mineral water.
The Suspected OEM World Liberty Financial
According to the World Liberty Financial whitepaper, DT Marks DEFI LLC has agreed to use reasonable efforts to require the owners and principals of DT Marks DEFI LLC, including Donald Trump, to occasionally promote WLF and World Liberty Financial, and to grant World Liberty Financial and its related entities the right and license to use the name, image, and likeness of the owners and principals of DT Marks DEFI LLC for promotional purposes.
And indeed, Trump's photos appear in 11 out of 13 pages of the World Liberty Financial whitepaper, and World Liberty Financial has also received the endorsement of the Trump family.
World Liberty Financial whitepaper cover
In return, World Liberty Financial has agreed that DT Marks DEFI LLC will receive 22.5 billion WLFI tokens and be entitled to 75% of the net revenue of the protocol, which is determined after deducting the agreed operating expenses and initial treasury reserves. The service agreement can be terminated by DT Marks DEFI LLC for "just cause" under certain conditions, or upon the expiration of the initial 5-year term without renewal.
DT Marks DEFI LLC is a Delaware limited liability company (of which Trump is one of the members), and its affiliated entities have received or may receive compensation for providing services to World Liberty Financial and its affiliates. These services are provided under a service agreement with Axiom Management Group, LLC ("AMG"), a Puerto Rico limited liability company wholly owned by Chase Herro and Zachary Folkman, under whose guidance World Liberty Financial was established. AMG is entitled to 7.5 billion WLFI tokens and 25% of the net protocol revenue, but has agreed to allocate 50% of this to WC Digital Fi LLC, an affiliate company of Steve Witkoff and some of his family members.
Looking at the World Liberty Financial team members:
World Liberty Financial co-founders Chase Herro and Zak Folkman own AMG, which can receive 7.5 billion WLFI tokens and 50% of the net revenue of the World Liberty Financial protocol, while the other half of the tokens and protocol revenue goes to the family of another co-founder, Steven Witkoff (co-founders Steven Witkoff, Zach Witkoff, Alex Witkoff).
The Masterminds Behind World Liberty Financial
Although World Liberty Financial co-founders Chase Herro and Zak Folkman have been involved in the crypto industry, they are not well-known in the crypto world.
According to CoinDesk, Chase Herro and Zak Folkman previously developed the DeFi product Dough Finance, but failed to gain attention and were hacked for $2 million in the summer of 2024. Chase Herro and Zak Folkman also co-founded the creator platform Subify, which claims to be an uncensored competitor to industry-leading platforms like Patreon and OnlyFans. Folkman had previously registered a company called Date Hotter Girls LLC and posted content on YouTube about how to approach women.
The blockchain lead of World Liberty Financial is Octavian Lojnita. According to Octavian Lojnita's online resume, he is from Romania and is a full-stack developer. Octavian Lojnita previously worked at Dough Finance. The anonymous front-end developer Boga of World Liberty Financial is listed as an author (under 0xboga) in the Dough Finance codebase.
CoinDesk also reported that World Liberty Financial had previously published a codebase on GitHub, which was later deleted. A review of their codebase showed that World Liberty Financial (at least in its early stages) seemed to have directly copied code from Dough Finance.
However, on September 4, 2024, World Liberty Financial posted on X that they did not want to take any risks, and their code "has been thoroughly audited by audit firms such as BlockSec, Fuzzland, PeckShield, and Zokyo".
Although World Liberty Financial has already started publicly selling its governance token WLFI on its website, the World Liberty Financial protocol and application have not yet been launched. It is currently unclear whether the subsequent versions of World Liberty Financial will include the early code or vulnerabilities of Dough Finance.
The other three co-founders of World Liberty Financial are the Witkoff family. According to public information, Steven Witkoff is a well-known real estate developer and an old friend of Trump.
WLFI Token Information
WLFI token price: $0.015
Public sale total: 20 billion tokens (equivalent to $300 million)
Sold so far: Only 723 million tokens (about $10 million) have been sold as of the time of writing, with 19.2 billion tokens still available for sale
Total token supply: 100 billion
FDV: $1.5 billion
Contract address: 0xda5e1988097297dcdc1f90d4dfe7909e847cbef6
WLFI token distribution:
- 35% Token Sale: A significant portion of WLFI tokens will be allocated through the token sale to eligible participants, encouraging them to actively participate in the governance and growth of the WLF protocol.
- 32.5% Community Growth and Incentives: This portion will be reserved for expanding the governance participation in the WLF community and supporting the development of the WLF protocol.
- 30% Initial Supporter Allocation: This portion of tokens is allocated to the initial supporters (22.5 billion + 7.5 billion, which have already been allocated to Donald Trump and the World Liberty Financial operations team).
- 2.5% Team and Advisors: This portion of tokens will be used to reward the core team, advisors, service providers, and contributors to the development of the WLF protocol.
The World Liberty Financial token WLFI also has a unique feature: the token status is non-transferable and locked indefinitely in wallets or smart contracts. Users should consider purchasing WLFI tokens as the acquisition of other non-refundable goods and services.
World Liberty Financial claims that if the transferability of WLFI is to be unlocked in the future through the protocol governance process, such unlocking will only be allowed if it is determined to not violate applicable laws, and it must be at least 12 months after the completion of the token sale. WLFI holders should assume that the tokens are indefinitely non-transferable. World Liberty Financial also does not plan to create a secondary market for the WLFI tokens.
The non-transferability of WLFI tokens may be to avoid regulation. This move is intended to make WLFI appear less like a security in the eyes of regulatory authorities, as this makes the asset difficult to trade like other cryptocurrencies.
In addition to the non-transferability of the tokens, the World Liberty Financial operations team has taken several proactive measures to avoid regulation by US law enforcement agencies.
How WLFI Tokens Avoid US Regulation
First, there are requirements for investors. Given Trump's significant influence in the US, World Liberty Financial's primary target is American investors. World Liberty Financial requires American participants in the investment to be "accredited investors" as defined by Regulation D, and they undergo KYC procedures. For overseas investors, KYC is also required, and the tokens are offered and sold in a manner that complies with the safe harbor conditions under Section 506(c) of the Securities Act.
Secondly, in terms of token utility, according to the World Liberty Financial website, World Liberty Financial has made special arrangements for the utility of its WLFI tokens:
- Governance-only use. The sole purpose of holding WLFI is for governance, not for any investment. As token holders, they will only have the right to propose and vote on proposals that help shape the future of the World Liberty Financial protocol, including decisions on marketing plans, future functionalities, and more.
- No economic rights. The tokens do not grant any express or implied rights, other than the right to use the tokens as a means of participating in the WLF governance platform. WLFI tokens do not represent or grant any ownership or equity, shares or securities, or equivalent rights, or any rights to receive any distributions, revenue sharing, additional tokens, intellectual property, or any other form of participation or rights related to the WLF protocol and/or the company and its affiliates.
- Non-transferable. All WLFI tokens are non-transferable and locked indefinitely in wallets or smart contracts. Users should consider purchasing WLFI tokens as the acquisition of other non-refundable goods and services and accept the risks. If the transferability of WLFI is to be unlocked in the future through the protocol governance process, such unlocking will only be allowed if it is determined to not violate applicable laws, and it must be at least 12 months after the completion of the token sale. WLFI holders should assume that the tokens are indefinitely non-transferable. Due to the non-transferability of the tokens, the World Liberty Financial protocol has not taken any action and does not plan to create a secondary market for the tokens.
World Liberty Financial has also made a clear distinction between WLFI tokens, the WLF governance platform, and the WLF protocol. WLFI tokens do not provide any economic or other rights related to the WLF protocol or other aspects. Therefore, there is no entitlement to any fees generated by the WLF protocol or earned by the company.
World Liberty Financial specifically states that WLFI tokens are not intended to be a digital currency, security, derivative, transferable cryptocurrency, or any other type of financial instrument. The tokens cannot be transferred or sold in exchange for money or other assets (including cryptocurrencies), nor can they be used to purchase goods or services from any party.
Conclusion
The evidence suggests that World Liberty Financial is a DeFi product under the OEM of the Trump family.
The real operations team behind World Liberty Financial has a "black" history, and the WLFI tokens are in a completely locked state, with no secondary market and no liquidity, which has slowed the progress of the public sale of WLFI, with only $10 million sold, far from matching Trump's momentum.
However, this does not negate the possibility of World Liberty Financial's future success. After all, the US presidential election is just three weeks away, and Trump has a good chance of returning to the White House.
With the huge traffic and Trump's endorsement, the OEM may also succeed. Just like Trump's other OEM products that sell the naming rights.
