Donald Trump’s crypto project, World Liberty Financial (WLF), has submitted a proposal to the Aave governance forum. The former president and his business partners plan to use the platform for their cryptocurrency offering.
The submission aims to establish WLF’s services as an instance on Aave, with the protocol providing the necessary underlying infrastructure. In return, AaveDAO will receive 20% of all protocol fees generated by WLF and 7% of the supply of WLFI, the project’s governance token.
WLFI Tokens Will Be Earned as Rewards
Additionally, the new proposal states that users will earn the WLFI tokens as rewards for participating in World Liberty liquidity pools. However, questions still remain about how AaveDAO will manage the custody of WLFI tokens and distribute them since the Trump project had labeled them as non-transferable.
Initially, WLF plans to accept deposits in Ethereum (ETH), Wrapped Bitcoin (WBTC), and the two leading stablecoins, USDC and USDT, allowing users to leverage these assets as collateral for borrowing. Revenue sharing will be conducted through a trustless smart contract.
This initiative reportedly offers several advantages for Aave: It aims to provide stablecoin liquidity for ETH and WBTC, attract first-time DeFi users to the platform, and create brand loyalty among participants.
In the future, the project plans to onboard additional assets that are not currently compatible with Ethereum’s primary market by capitalizing on connections to traditional finance and institutional investments.
AaveDAO, WLFI Token Holders to Participate in Vote
Last month, Trump and several of his associates, including his sons Eric and Don Jr. and billionaire Steve Witkoff, announced World Liberty. The team has positioned the project as a more “user-friendly” alternative to existing DeFi options like Aave, which can be challenging to navigate without considerable technical expertise.
In late September, the project opened whitelists for select accredited investors to purchase WLFI tokens. These assets are offered under a U.S. Securities and Exchange Commission (SEC) regulation that permits only high-net-worth or knowledgeable investors to participate.
However, the World Liberty team has previously expressed its intention for all Americans to access the platform “in the future,” pending approval and eventual launch.
The draft proposal will now be discussed by AaveDAO community members, who will decide whether to vote on allowing the Republican presidential candidate and his business partners to build their DeFi offering on Aave. WLFI token holders will also need to approve the proposal separately.