Trump-Backed World Liberty Financial Proposes Launch on Aave's Ethereum Platform - Blockonomi
by Oliver Dale · BlockonomiTLDR:
- World Liberty Financial, a Trump-backed crypto project, submitted a proposal to launch on Aave’s Ethereum mainnet
- The project aims to offer borrowing and lending services for ETH, WBTC, USDC, and USDT
- AaveDAO would receive 20% of protocol fees and 7% of WLFI token supply
- World Liberty Financial targets new DeFi users familiar with the Trump brand
- If approved, the platform would be accessible to all Aave users, including Americans
World Liberty Financial, a cryptocurrency project backed by former President Donald Trump and his associates, has submitted a formal proposal to launch on the Ethereum mainnet using Aave’s decentralized finance (DeFi) protocol.
The proposal, announced on October 9, 2024, outlines the project’s plans to offer borrowing and lending services for cryptocurrencies.
According to the proposal, World Liberty Financial aims to operate as an Aave v3 instance, utilizing the popular DeFi platform’s infrastructure. The project plans to initially support deposits in Ethereum (ETH), Wrapped Bitcoin (WBTC), and stablecoins such as USD Coin (USDC) and Tether (USDT).
In exchange for using Aave’s protocol, World Liberty Financial has offered to share 20% of all protocol fees generated with AaveDAO, the group of Aave token holders that govern the platform.
The proposal includes allocating 7% of the supply of WLFI, World Liberty Financial’s governance token, to AaveDAO.
The Trump-backed project emphasizes its goal of creating a more user-friendly DeFi experience, particularly targeting individuals familiar with the Trump brand but new to the world of decentralized finance. World Liberty Financial claims that this approach could bring a significant number of new users and increased liquidity to the Aave ecosystem.
If approved, the World Liberty Financial Aave instance would be accessible to all Aave users, including Americans.
This broad accessibility raises potential regulatory concerns, as other U.S.-based DeFi protocols have faced scrutiny from the Securities and Exchange Commission (SEC) regarding the offering of unregistered securities.
The proposal is currently open for discussion among AaveDAO community members, who will ultimately vote on whether to allow Trump and his associates to build their DeFi offering on Aave’s protocol. Separately, holders of the WLFI token would also need to approve the plan.
World Liberty Financial has stated that if the Aave integration is successful, they plan to expand to the Ethereum layer 2 blockchain Scroll. The project’s team, which includes Trump’s sons Eric and Donald Jr., as well as New York billionaire Steve Witkoff, believes that partnering with Aave will enable them to deliver a reliable platform for their users.
Marc Zeller, founder of the Aave Chain Initiative, expressed curiosity about the potential new user base that World Liberty Financial could bring to the DeFi ecosystem. Some Aave community members have shown interest in the proposal, noting that the revenue share and token allocation appear fair.
The launch of World Liberty Financial on Aave’s platform would require a series of approval steps, including a “temp check” vote, a community feedback period, and a testing phase before the potential mainnet launch.
As of October 2024, the total value locked across DeFi protocols on the three largest chains – Ethereum, Solana, and Tron – exceeds $57 billion. However, DeFi remains relatively unknown to many Americans, and projects like World Liberty Financial could potentially introduce new audiences to the decentralized finance ecosystem.