Author: Weilin, PANews
Trump's DeFi project World Liberty Financial (WLFI) made significant purchases of crypto assets in December, with cumulative expenditures nearing $45 million, including ETH, cbBTC, LINK, AAVE, ENA, and the latest ONDO.
Since the project launched in September, it claims to be a decentralized finance (DeFi) platform. On December 13, the World Liberty Financial community voted to deploy an Aave v3 instance. Although the project has made initial progress, the current situation shows that the leadership team consists mostly of new faces, and there is still some uncertainty regarding the practicality and innovativeness of the project.
In December, significant purchases of crypto assets totaled nearly $45 million.
According to blockchain data platform Lookonchain, since November 30, World Liberty Financial has acquired a large amount of crypto assets through one wallet, including $30 million worth of Ethereum (ETH) and $10 million worth of Coinbase Wrapped BTC (cbBTC). Other acquired assets include LINK, AAVE, ENA, and the recently purchased $250,000 worth of Ondo tokens. The specific data for these purchases is as follows:
Purchased 8,105 ETH for $30 million USDC, at a price of $3,701 each;
Purchased 103 cbBTC for $10 million USDC, at a price of $97,181 each;
Purchased 78,387 LINK for $2 million USDC, at a price of $25.5 each;
Purchased 6,137 AAVE for $2 million USDC, at a price of $326 each;
Purchased 509,955 ENA for $500,000 USDC, at a price of $0.98 each;
Purchased 134,216 ONDO for $250,000 USDC, at a price of $1.86 each.
Additionally, although COW is not on World Liberty Financial's asset list, recent on-chain token purchases have all used Cowswap, which is also one of the most commonly used DEXs by Ethereum founder Vitalik Buterin.
World Liberty Financial launched in September, claiming to be a decentralized finance (DeFi) platform for cryptocurrency trading, with former President Trump listed as the 'chief crypto advocate.' Trump's sons Donald Trump Jr., Eric Trump, and Barron Trump serve as 'ambassadors.' Companies associated with the family are entitled to 75% of the net income.
The project has performed poorly in selling its namesake token, World Liberty Financial (WLFI). According to the roadmap, the $1.5 billion is the fully diluted valuation for the project, and the WLFI 'initial sale' plan aims to raise $300 million by selling 20% of the token supply. However, as of December 17, 4.99 billion WLFI have been sold, totaling $74.85 million at a price of $0.015 each, which is less than a quarter of the $300 million target. Notably, Sun Yuchen disclosed that he invested $30 million in WLFI, becoming the largest investor in the project. Currently, no institutions have publicly announced investments in the project.
The WLFI community voted to approve the first proposal to deploy a lending instance based on Aave v3.
Meanwhile, the good news is that on December 13, the World Liberty Financial governance page showed that the WLFI community voted to approve the first proposal to deploy a lending instance based on Aave v3 on the Ethereum mainnet.
As of December 16, Aave DAO has a treasury worth $347 million. Initially, the Aave community was skeptical when World Liberty Financial announced it would build on the Aave protocol. However, in October, the situation changed when World Liberty Financial proposed to allocate 7% of its WLFI tokens and 20% of future fees generated by WLF to the crypto collective Aave DAO managing the Aave protocol.
The proposal suggests deploying an Aave v3 instance based on World Liberty Financial (WLF), focusing on:
Provide stablecoin liquidity for ETH and WBTC.
Expand the user base of the Aave protocol.
The proposal needs to be approved by AaveDAO and the WLF community governance. If the proposal is approved, users will be able to deposit USDC and USDT stablecoins, as well as ETH and wBTC on the protocol. These assets can serve as collateral for borrowing other assets on Aave.
The proposal mentions that the benefits to Aave include bringing a large number of new users and liquidity, establishing brand loyalty and awareness among new DeFi users, and reinforcing Aave's leading position in the digital asset lending market.
Next, the proposal has several steps: 1. If the temperature check (TEMP CHECK) reaches consensus, it will be submitted to the Snapshot phase. 2. If the Snapshot vote passes, it will enter the ARFC phase. 3. Release a standard ARFC and gather feedback from the community and service providers. 4. If the ARFC Snapshot passes, release an AIP vote for final confirmation and execution.
What is the background of the WLFI leadership team, which consists of unfamiliar faces?
There are many new faces behind Trump's DeFi project that are not well-known in the crypto circle. In addition to Trump and his family members, the five co-founders of this project are Chase Herro, Zak Folkman, Steven Witkoff, Zach Witkoff, and Alex Witkoff.
Among them, Chase Herro's background is particularly unusual; he has reportedly engaged in several businesses seemingly unrelated to the crypto industry, including marijuana sales and weight loss products, and has flaunted luxury cars and private jet travel on social media, yet is not well-known in the crypto circle. The only crypto project he publicly participated in, Dough Finance, attracted only a few million dollars and suffered a severe hacking attack. A token he promoted on influencer Logan Paul's podcast plummeted by 96% after promotion. In a talk in 2018, he referred to himself as 'the scourge of the internet' and stated that regulators should 'kick people like me out.'
In addition, another co-founder, Chase Herro's business partner Zak Folkman, previously ran a service called Date Hotter Girls, where he taught seminars on how to flirt with women, which is a somewhat controversial background.
As for Steven Witkoff, he is a friend of Trump, a real estate developer, and donated $2 million to Trump's campaign. After Trump's victory, he was appointed as a special envoy to the Middle East. Witkoff's sons, Alex and Zach, are listed as co-founders of World Liberty Financial.
In addition to these co-founders with relatively distant market relations to crypto, the backgrounds of the heads of other specific business sectors appear more professional and closer to the crypto industry.
Rich Teo, who serves as the head of stablecoins and payments, is also an OG in the crypto field. He co-founded the exchange itBit in 2012 and later co-founded the stablecoin company Paxos, where he currently serves as CEO for the Asia-Pacific region. Additionally, Rich is an advisor for the AI-driven SocialFi project RepubliK and has retweeted many of its tweets on Twitter.
Corey Caplan serves as the head of technical strategy; he is a co-founder of Dolomite. Dolomite is a DeFi platform that launched on Arbitrum One in October 2022 and has since expanded to other blockchain ecosystems, including Polygon's zkEVM, Mantle, and X Layer, providing various services such as margin trading, lending, and portfolio management.
Bogdan Purnavel serves as the chief developer; he was also a developer at Dough Finance, and his online nickname is 0xboga. The blockchain lead at World Liberty Financial is Octavian Lojnita. According to his online resume, he is from Romania and is a full-stack developer. Octavian Lojnita also previously worked at Dough Finance.
Alex Golubitsky serves as legal counsel. Alex Golubitsky is an international tax lawyer with a career covering areas such as tax law, securities law, entity formation, contract drafting, and litigation. He is a partner at MetaLeX Pro, LLP, and serves as general counsel at Brisa Max Holdings VI, LLC.
In addition, World Liberty Financial has an advisory team made up of venture capitalists, lawyers, and blockchain engineers. Sandy Peng, co-founder of the Ethereum Layer 2 blockchain Scroll, and Luke Pearson, general partner at Polychain Capital, are both advisors to the project.
Currently, World Liberty Financial's large-scale token purchases have sparked different evaluations from the public.
Nansen research analyst Nicolai Søndergaard told Bloomberg that World Liberty Financial's token purchases might be 'to gain more trust or to promote the development of its project by drawing attention to these assets, as if these assets perform well, World Liberty Financial might also benefit.'
Although World Liberty Financial's plans may sound innovative to those unfamiliar with cryptocurrencies, startups like this are actually quite common, with few succeeding. Many of these companies are established merely to sell tokens and make profits, as stated by Tarun Chitra, a general partner at Robot Ventures.
Overall, Trump's family DeFi project World Liberty Financial has demonstrated its ambition in the crypto space through large-scale token purchases and collaboration with Aave. The targeted investment has also become a barometer of investor interest. However, the leadership team is relatively unfamiliar, and the practicality and innovativeness of the project remain uncertain. Nevertheless, as a project initiated by the family of America's 'crypto president,' it will still attract widespread market attention, and the subsequent situation is worth further monitoring.
