donald Trump’s crypto project World Liberty
Financial has been selling ETH despite being 50% down on its investment The craziest part is
that it’s denied claims that it’s been selling ETH even though onchain evidence suggests the
opposite See it’s the opposite Despite the DeFi protocol literally having the backing of the
president of the United States many investors are skeptical about World Liberty Financial and its
altcoin investments So today we’re going to see what’s going on My name is Guy and you’re watching
the Coin Bureau Now then let’s begin with a bit of context World Liberty Financial is a DeFi protocol
backed by President Donald Trump which is designed to let users lend borrow and invest in crypto
The general idea is to promote the adoption of DeFi and stable coins in order to strengthen the
US dollar All in order to quote make crypto and America great I guess we probably should have seen
that tagline coming As a fun fact the reason why World Liberty Financial is targeting stable coin
adoption is because most stable coins pegged to the dollar are largely backed by US government
debt So whenever you buy a stable coin you’re actually subsidizing the US government spending
and helping the US dollar maintain its dominance Now what’s crazy is that World Liberty Financials
official X account says that quote “We want US pegged stable coins to remain the world settlement
layer for the next 100 years.” Translation: We want US dollar stable coins to become the world’s
next reserve currency The jury is still out as to whether that would be bullish or bearish for
crypto Anyhow World Liberty Financial was created in September 2024 by two entities affiliated with
Trump and his family These are DT Marks Defi and WLF Holdco the latter of which apparently holds
100% interest in World Liberty Financial Now the protocol is designed to be accessible even for
those who have never used crypto before It was co-founded by developers Chase Herrow and Zachary
Fulkman both of whom have worked on DeFi protocols in the past specifically Dough Finance which
had a similar focus on being user-friendly World Liberty Financials website also notes the other
co-founders as Steve Zack and Alex Witkoff from the Wititov Group a privately held global real
estate development and investment firm And at this point it’s important to note that President
Trump himself isn’t directly involved with the project In fact the project’s website merely lists
the president as the chief crypto advocate However it seems that his sons are more actively involved
namely Eric Baron and Donald Jr all three of whom are listed as Web 3 ambassadors Despite the
Trump ties though the project claims to be non-political in nature Now it’s also important
to note that even though the protocol was created in September last year World Liberty Financial
hasn’t officially launched yet and we couldn’t find any future launch date However the protocol
does have its own native token which we’ll come back to in a moment What we do know so far is that
the protocol uses Ave’s V3 framework for borrowing and lending services and uses chain links oracles
for real-time price feeds This has raised a few eyebrows which we’ll come back to later And by
the way if you’re enjoying the video so far then hasn’t officially launched yet but there is a
token called WLFI Ironically though World Liberty Financials so-called gold paper reveals that WLFI
isn’t available to investors in the US although one of the project’s leaders Zack Fulman said it
would be available to accredited US investors aka rich people The token’s public sale went live in
October last year with each token valued at 1.5 More than 100,000 people signed up to the token
sale prior to its launch However the launch itself was a bit of a flop with just 4% of the supply
sold on the first day It wasn’t until January of this year when 20% of the supply was eventually
sold at which point the project announced that it would be selling another 5% of the supply this
time at 5 cents per token What’s funny is that they said they made this decision quote due to
massive demand and overwhelming interest You’ll recall there wasn’t much interest at the start
In any case WLFI is an ERC20 token It has a total supply of 100 billion which are distributed as
follows 35% are allocated to token sales 32.5% to community growth and incentives 30% was set aside
for initial supporters and 2.5% for the team The project’s website shows that the token sale has
now ended with the last purchase of WLFI taking place over a month ago According to Etherscan WLFI
has more than 85,000 holders What’s concerning though is that the largest nonsmart contract
wallet holds more than 15% of the supply Notably Cointelegraph reported in November that Tron
founder Justin Sun became the project’s biggest investor and was later added to its advisory board
as a result This suggests that he is the WLFI whale Anyway speculation aside this brings us to
what WLFI is used for and this is where things get interesting to say the least That’s because WLFI
is used for governance with each token accounting for one vote on proposals But this is where the
use case ends Controversially WLFI tokens can’t be sold transferred or traded Moreover the tokens
also don’t offer any additional economic benefits such as staking and nor are there any plans to add
these features at least no plans that are public yet Now normally DeFi protocols will announce
that these features will be added later but World Liberty Financial has made no mention of such
features yet The project claims that the reason for this is to align users with the protocol’s
long-term vision while removing the possibility of speculative price action However this does raise
questions of what incentives the team envisioned with its token distribution and how much demand
the token can generate In case you haven’t noticed governance isn’t exactly a great demand driver
From our perspective it’s possible the real incentive could be related to the stable coin For
context World Liberty Financial recently launched its own stable coin USD1 on BNB and Ethereum
which isn’t tradable at the time of shooting According to the accompanying announcement USD1
is quote 100% backed by short-term US government treasuries US dollar deposits and other cash
equivalents However the launch of USD1 has been met with criticism particularly from Democratic
senators who have questioned the OC and the Federal Reserve on how they plan to regulate both
World Liberty Financial and the USD1 stablecoin Notably this comes as two critical pieces of
stable coin regulation make their way through Congress The Stable Act and the Genius Act both
of which aim to create clear regulatory frameworks for stable coins in the US So then this brings
us to the cryptos that World Liberty Financial currently holds in its portfolio and what it’s
been doing with them According to data from Arkham World Liberty Financial is holding around $100
million in assets at the time of shooting The protocol’s largest holding is circles USDC stable
coin with around $23.5 million USDC According to Arkham this USDC was first acquired on the 14th
of October The protocol then acquired around 11 million of Tether’s USDT the following day which
is interesting As for non-stable coin assets the protocol’s largest position is in wrapped BTC
where it currently holds 162.7 WBTC worth roughly $14 million This wrapped BTC was first purchased
on the 18th of December and its value has dropped roughly 20% since then This position is closely
followed by its holding of almost 8,000 ETH which is currently worth $12.7 million This was first
acquired on the 21st of September making it the platform’s first major purchase However it’s
fallen by around 37% Notably the protocol also holds roughly 5,000 Lido staked ETH worth $8
million So when combined this means that ETH is technically the protocol’s largest position
And this STE was first accumulated on Trump’s inauguration day of the 20th of January and has
since fallen by 40% Ouch Earlier this month World Liberty Financial faced allegations that it
had sold around $8 million worth of ETH which it later denied describing these allegations as
simply quote speculation However this doesn’t seem to be the case Data from Arkham shows that
not only did a wallet linked to the protocol sell this ETH but it did so at a loss Specifically the
ETH in question was purchased for $3,259 per coin at the start of the year and was sold when ETH’s
price was just $1,465 That’s a loss of around 55% In fact by the middle of April World Liberty
Financial had reportedly spent around $347 million acquiring 11 different altcoins and has
yet to turn a profit on any of them Data from Look on Chain revealed that the protocol’s investments
are down by around $145 million And what’s crazy is that its Ethereum investments account for $114
million worth of these losses Now I’ll quickly note that if you check World Liberty Financials
portfolio on Arkham you’ll also notice there’s a bunch of meme coins that have been sent to the
protocol presumably as a marketing strategy We’ve blurred these out for obvious reasons Anyways
back in February World Liberty Financial created a strategic reserve fund which they aptly
called the Macro Strategy Fund Very clever Now the fund primarily consists of BTC ETH
and a number of altcoins that the team says are quote at the forefront of reshaping global
finance The reserve will focus on diversifying the platform’s assets while creating partnerships
with the relevant projects for joint marketing and PR efforts The protocol’s latest addition came in
early March when Sooie announced it had partnered with World Liberty Financial As part of the deal
Sooie was added to the company’s macro strategy reserve with both entities exploring opportunities
for development Now this addition wasn’t exactly surprising Eric Trump is reportedly a Sooie holder
and is a vocal fan of the project WLF’s co-founder Zack Fulman said Sooie was selected for its
Americanborn innovation Keep that in mind for later Now this brings us to the concerns we have
around World Liberty Financial And we’re not going to sugarcoat it folks We have quite a few Our
biggest concern by far is tokconomics Remember WLFI tokens are solely used for governance votes
They’re going to need a bit more than that to make them an appealing investment Combine this with
WLFI being unavailable to most US investors and you start to question how much demand there’ll
be for the token and by extension the protocol And this ties into our second concern
which is the protocol’s revenue structure That’s because World Liberty Financial directs
a whopping 75% of its net revenue to the Trump family This will undoubtedly spark political
opposition and this puts World Liberty Financial under the spotlight for regulatory scrutiny The
protocol could also face further political rivals in the future who could target it over conflicts
of interest or even insider trading concerns Our third concern meanwhile is a lack of innovation As
many have pointed out World Liberty Financial is basically just a Trump themed investment vehicle
repackaging existing a products under the Trump brand And this ties into our fourth concern
and that’s an apparent lack of transparency Now to be clear we’re not saying that World
Liberty Financial necessarily has anything to hide But we do seem to be missing some key
details For example when people began raising concerns about the amount of ETH the project was
selling the team responded by using phrases like quote “No need to speculate.” In our view this is
akin to saying “Nothing to see here.” Needless to say this raises a little bit of suspicion So then
folks this leads us to the allimportant question How could World Liberty Financial influence the
crypto market in the future well under the right conditions the Trumpbacked DeFi protocol could be
bullish for the crypto industry That’s because it could spark a wave of speculative investment
into crypto Logically many of those who were previously unsure about crypto will perhaps be
more comfortable investing in the asset class assuming they’re fans of Trump of course More
importantly these investors would likely ape into the cryptos that Trump supposedly endorses i.e the
ones that make up the protocol’s macro strategy reserve To refresh your memory these include
Bitcoin’s BTC Ethereum’s ETH and Tron’s TRX to name a few At the same time though it’s important
to note that not much is known about the protocol and it’s unclear when it’ll even launch It’s also
safe to say that so far the interest from existing crypto natives has been lackluster which speaks
volumes After all many crypto investors have been carefully watching Trump’s every move in the
space And not only that but the USD1 stable coin could actually throw a spanner in the works
and delay stable coin regulations which have so far seen bipartisan support That’s simply
because a Trumpbacked stable coin essentially adds additional political aspects that could face
additional opposition That said it’s still early days and it remains to be seen how much innovation
the team can deliver The project already has some impressive partnerships The more these
partnerships continue to grow the more this opens the door to World Liberty Financial being able to
expand its operation And as for the cryptos that World Liberty Financial acquires in the future
well it’s safe to say that such an acquisition would likely be bullish and could pump the price
of the cryptos in question And remember what we said earlier the protocol recently teamed up with
Suie while crediting it for US-born innovation So this could mean that World Liberty Financial will
prefer to accumulate American projects And in case you were wondering which ones they could be well
you’re in luck We actually have a video all about that which you can check out right over here Okay
if you enjoyed that video then you know what to do Hit up those like and subscribe buttons and
turn on those notifications too so you don’t miss our next one If you want to see how many
Americans are holding crypto and why then you can check out this video right over here And
if you want to learn more about the impact of Trump’s tariffs on the market then you can
find out by checking out this video right over here Okay thank you all for watching and we’ll
see you in the next one This is Guy signing off
