Written by: Weilin, PANews
Trump's DeFi project World Liberty Financial (WLFI) made significant purchases of crypto assets in December, accumulating nearly $45 million in expenditures, including ETH, cbBTC, LINK, AAVE, ENA, and the latest ONDO.
Since its launch in September, the project has claimed to be a decentralized finance (DeFi) platform. On December 13, the World Liberty Financial community deployed an Aave v3 instance through the first proposal. Although the project has made initial progress, the majority of the leadership team are new faces, and the practicality and innovation of the project still have certain uncertainties.
Purchase of crypto assets in December totaled nearly $45 million.
According to blockchain data platform Lookonchain, World Liberty Financial has purchased a large amount of crypto assets since November 30 through one wallet, including $30 million worth of Ethereum (ETH) and $10 million worth of Coinbase Wrapped BTC (cbBTC). Other purchased assets include LINK, AAVE, ENA, and the latest purchase of $250,000 worth of Ondo tokens. The specific data for these purchases is as follows:
Using $30 million USDC to purchase 8,105 ETH at a price of $3,701 each;
Using $10 million USDC to purchase 103 cbBTC at a price of $97,181 each;
Using $2 million USDC to purchase 78,387 LINK at a price of $25.5 each;
Using $2 million USDC to purchase 6,137 AAVE at a price of $326 each;
Using $500,000 USDC to purchase 509,955 ENA at a price of $0.98 each;
Using $250,000 USDC to purchase 134,216 ONDO at a price of $1.86 each.
In addition, although COW is not on World Liberty Financial's asset list, the recent on-chain purchases of tokens have 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, and has listed former President Trump 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, $1.5 billion is the fully diluted valuation of the project, and the 'initial sale' plan of WLFI aims to raise $300 million by selling 20% of the token supply. However, by December 17, 4.99 billion WLFI tokens had been sold, totaling $74.85 million at a unit price of $0.015, which is less than a quarter of the $300 million target. It is worth mentioning that Sun Yuchen disclosed an investment of $30 million in WLFI, becoming the largest investor in the project. Apart from this, no institutions have announced investments in the project.
The WLFI community voted to pass the first proposal, which will 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 pass the first proposal to deploy a lending instance based on Aave v3 on the Ethereum mainnet.
As of December 16, the Aave DAO has a treasury valued at $347 million. Initially, when World Liberty Financial announced it would build based on the Aave protocol, the Aave community was skeptical. However, in October, after 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 that manages the Aave protocol, the situation changed.
The proposal suggests deploying an Aave v3 instance based on World Liberty Financial (WLF), focusing on:
Provide liquidity in stablecoins for ETH and WBTC.
Expand the user base of the Aave protocol.
Proposals need 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 be used as collateral to borrow 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 recognition among new DeFi users, and consolidating Aave's leading position in the digital asset lending market.
Next, the proposal has several steps: 1. If temperature check (TEMP CHECK) reaches consensus, it will be submitted to the Snapshot phase. 2. If Snapshot voting passes, it will enter the ARFC phase. 3. Release standard ARFC and collect feedback from the community and service providers. 4. If ARFC Snapshot passes, release AIP voting for final confirmation and execution.
What is the background of the WLFI leadership team, who are not familiar faces?
There are many unfamiliar faces behind this DeFi project by Trump. Besides 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 has a relatively unique background. It has been reported that he has engaged in several businesses that seem unrelated to the crypto industry, including marijuana sales and weight loss products, and he boasts about luxury cars and private jet travels on social media, yet he has little reputation in the crypto circle. The only crypto project he publicly participated in, Dough Finance, only attracted a few million dollars and faced severe hacking attacks. A token he promoted on the podcast of influencer Logan Paul plummeted by 96% after the promotion. In a 2018 speech, 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 has a controversial background.
As for Steven Witkoff, he is a friend known to Trump and is a real estate developer who donated $2 million to Trump's campaign. After Trump's victory, he was appointed as the Middle East envoy. Witkoff's sons Alex and Zach were listed as co-founders of World Liberty Financial.
Aside from these co-founders who are less known in the crypto market, the backgrounds of other specific business segment leaders appear to be 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 space. He co-founded the exchange itBit in 2012 and then co-founded the stablecoin company Paxos, where he currently serves as CEO for Asia. Additionally, Rich is an advisor to the AI-driven SocialFi project RepubliK and has retweeted several posts about the project on Twitter.
Corey Caplan serves as the head of technical strategy. Corey Caplan is a co-founder of Dolomite, 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, offering various services such as margin trading, lending, and portfolio management.
Bogdan Purnavel serves as the chief developer; he was also a developer for Dough Finance and is known online as 0xboga. The blockchain head of World Liberty Financial is Octavian Lojnita. According to his online resume, he is a full-stack developer from Romania. 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 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 also has an advisory team consisting of venture capitalists, lawyers, and blockchain engineers. Sandy Peng, co-founder of 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 mixed evaluations from the outside.
Nansen research analyst Nicolai Søndergaard told Bloomberg that the token purchases by World Liberty Financial may be 'to gain more trust or to promote its own project by drawing attention to these assets, as if these assets perform well, World Liberty Financial could also benefit.'
Although to those unfamiliar with cryptocurrency, World Liberty Financial's plans may sound innovative, startups like this are actually quite common, with few succeeding. Many of these companies are simply established to sell tokens and make profits, as previously stated by Tarun Chitra, a general partner at Robot Ventures.
Overall, the Trump family's DeFi project World Liberty Financial has demonstrated its ambition in the crypto field through large-scale token purchases and collaboration with Aave. Their investment targets have also become a trend indicator for investors. However, their leadership team is relatively unfamiliar, and the project's practicality and innovation remain uncertain. Nevertheless, as a project initiated by the family of America's 'Crypto President,' it will still attract significant market attention, and further developments are worth monitoring.
