Trump’s new DeFi project World Liberty Financial aims at SEC reversal on crypto

Donald Trump and his team have released information on the pending launch of World Liberty Financial, a new DeFi project built on the Aave tech stack.

Following a 2-hour X (formerly Twitter) Space last night, the team confirmed the initiative aims to transform the traditional financial system by leveraging blockchain technology. It focuses on tokenizing real estate assets to make high-value property investments accessible to a broader audience, bypassing conventional banking barriers.

Key figures involved include Donald Trump Jr., Eric Trump, Steve Wickoff, Zach Folkman, and Chase Hero. Folkman and Chase previously founded an alternative to OnlyFans called Subify, Dough Finance, and Date Hotter Girls LLC, offering tips on dating for men. Dough Finance was hacked for around $2 million in July, according to Cerik.

Reports suggest that World Liberty Financial may not be owned by the Trump family. Folkman and Chase are the main company executives, according to an allegedly leaked Whitepaper.

This new project seeks to democratize finance by offering peer-to-peer transactions through smart contracts, reducing reliance on intermediaries like banks and lenders. “DeFi is the way of the future,” Don Jr. stated, emphasizing the need to create a more egalitarian financial system.

World Liberty Financial intends to tokenize real-world assets onto the blockchain. This approach aims to provide global investors access to blue-chip real estate markets traditionally reserved for institutional players. Utilizing blockchain’s transparency and immutability, the project aspires to eliminate inefficiencies and abuses prevalent in the current financial landscape.

Donald Trump’s involvement confirms his shift in stance on crypto. “I do believe in it,” he said, highlighting his recognition of crypto’s potential after observing his children’s engagement with digital assets. The former president also emphasized the United States’s need to lead in emerging technologies to remain competitive globally.

Concerns have been raised regarding the project’s structure and regulatory compliance. As Popular Information reported, 70% of World Liberty Financial’s governance tokens (WLFI) may be allocated to insiders like Trump and his sons, a figure substantially higher than typical allocations in similar ventures. This has led to speculation about the project’s intentions and potential conflicts of interest.

Critics also point out the possibility of the governance token being classified as an illegal security under current Securities and Exchange Commission (SEC) guidelines. “The SEC’s been unbelievably hostile,” Trump remarked, suggesting that his involvement might influence the agency’s approach to crypto regulation.

However, Folkman has reportedly stated that the WLFI token will follow a different schedule, according to CNBC. According to Folkman, 20% of the project’s tokens will be allocated to the founding team, which includes the Trumps; 17% will be reserved for user rewards, and the remaining 63% will be available for public purchase. He added that there will be no pre-sales or early buy-ins.

He also stated that the token will be offered under the Securities and Exchange Commission’s Regulation D, which permits companies to raise capital without registering their securities, provided certain conditions are met.

Political implications are intertwined with the project’s launch. Per Judd Legum, Trump could leverage the presidency to advance World Liberty Financial’s interests if re-elected, raising ethical questions about the intersection of public office and private enterprise. However, Trump has already vowed to fire Gary Gensler should he win the election, suggesting a regime change is indeed in his plans.

World Liberty Financial positions itself as a response to perceived overregulation in the financial sector, aiming to foster innovation without excessive bureaucratic constraints. The project aligns itself with what Don Jr. describes as the vision of America’s founding fathers, promoting individual freedom and reduced government control in finance.

The initiative’s success hinges on navigating regulatory challenges and public skepticism. By championing DeFi and blockchain technology, World Liberty Financial seeks to reshape the financial industry, but regulators and the crypto community alike will closely watch its journey.

A plethora of scam X (formerly Twitter) accounts have appeared in recent weeks, attempting to steal users’ crypto. There are also reports of fake Telegram accounts. Fake WLFI tokens also appear on DEXs and CoinMarketCap, meaning users should stay vigilant.

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