Republican presidential candidate Donald Trump helped officially unveil World Liberty Financial, his highly-anticipated cryptocurrency project, on Monday night.
"We're embracing the future with crypto and leaving the slow and outdated big banks behind," Trump said in a recent hype video.
In a live Spaces hosted by crypto personality Farokh on the social media platform X, Trump said his NFT projects are what started opening his eyes to the crypto world. The livestream ran for over two hours.
"Because so many people paid this way [with crypto], I was blown away," said Trump, who has earned more than $7 million from his NFT collections. "I wasn't overly interested [at first] to be honest... but I was surprised by the massive amount."
During the opening remarks, Trump said crypto is "big and yet it’s a fledgling compared to what it will be... I think my children opened my eyes."
DeFi and WLFI token
Donald Trump Jr. and father-son real estate investors Steve and Zach Witkoff spoke about the need for disruption in the lending market. "This is the start of a financial revolution," said Trump Jr.
Dough Finance co-founders Zachary Folkman and Chase Herro, along with Eric Trump, took over to further discuss the reasoning behind World Liberty Financial.
“Take the best of DeFi and bring it to the everyday person," Folkman said. He then confirmed that World Liberty Financial will sell a non-transferable governance token called WLFI. In light of regulatory uncertainty, WLFI plans to limit participation to accredited investors.
The WLFI token will be distributed as follows: 63% will be sold to the public, 17% for user rewards, and 20% for team compensation, Folkman said.
DeFi allows users worldwide to earn returns on stablecoins like USDC and USDT by supplying liquidity to decentralized lending platforms, among other applications.
"If the credit appetite of crypto traders rises, stablecoin DeFi yields could rise above 5%, beating those on offer by U.S. dollar money market funds," The Block's James Hunt wrote earlier Monday, citing Bernstein analysts. "That would further reignite crypto credit markets and add fuel to digital assets prices."
World Liberty Financial hype builds
The project was first teased on Aug. 7 by Donald Trump Jr. and Eric Trump, who said announcements around crypto and DeFi would be forthcoming. "Decentralized finance is the future, don’t get left behind," they said at the time.
RELATED INDICES
The Block Research's Steven Zheng first noted in August the link between the Trump project, Herro and his connection to Dough Finance. In July, Dough Finance was hit with a $1.8 million flash loan attack.
On Sept. 3, CoinDesk reported on a whitepaper being workshopped that said the project will be built on the decentralized finance platform Aave on the Ethereum blockchain and center around a "credit account system.”
The project had said it is making security a top concern and wants to drive the adoption of stablecoins. Earlier this month, Lara and Tiffany Trump’s X accounts were hacked, posting about a token purportedly associated with World Liberty Financial.
TD Cowen Washington Research Group's Jaret Seiberg said earlier today that World Liberty Financial could be a "significant political problem for the crypto sector" if Trump wins the presidential election in November.
"Our concern is that the Trump family's launch of a crypto venture will derail the emerging bipartisan view of how crypto should be regulated, which may stymie efforts to establish a crypto regulatory regime," Seiberg wrote in a note ahead of Monday's launch.
Trump's crypto pivot
Trump's stance on cryptocurrency changed this year, beginning in May when his campaign started accepting crypto as a form of donation. He has since met with executives from bitcoin mining companies and has said he wants to make the United States "the crypto capital" of the world.
On Monday, Trump said there "should have certain safeguards too, can't be totally freewheeling."
Trump spoke at the Bitcoin 2024 conference earlier this summer, where he said he would fire SEC Chair Gary Gensler if elected president and would stop the U.S. from selling any of its bitcoin holdings. He has also endorsed clemency for Ross Ulbricht, who has served 11 years of a life sentence for creating the dark web marketplace Silk Road.
"If we don't win the election, those people that were under investigation and that are free as a bird right now," Trump said Monday night, "and people that weren't being looked at in the crypto world, they will be living in hell because it will start the day after the election if they win."
Crypto figures and corporations have given more than $190 million to candidates and PACs this election cycle, CNBC reports, up from $15 million in 2020.
The price of bitcoin was trading around $57,800 at publication time, down about 1% according to The Block's price page. Ether's price was around $2,280.Disclaimer: The Block is an independent media outlet that delivers news, research, and data. As of November 2023, Foresight Ventures is a majority investor of The Block. Foresight Ventures invests in other companies in the crypto space. Crypto exchange Bitget is an anchor LP for Foresight Ventures. The Block continues to operate independently to deliver objective, impactful, and timely information about the crypto industry. Here are our current financial disclosures.
© 2024 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.