Key Insights:
- World Liberty Financial proposes a buyback-and-burn program to boost confidence after a challenging market debut.
- The initiative aims to reduce token supply by utilizing liquidity fees to buy back and destroy WLFI tokens.
- An alternative community proposal recommends auto-staking of locked tokens, although it lacks the support that the burn proposition has garnered.
Article Summary:
World Liberty Financial (WLFI), associated with the Trump family, is advocating a new approach to calm investor fears after a shaky market introduction, suggesting a buyback-and-burn strategy funded by fees from protocol liquidity.
As WLFI encounters significant market challenges following a high-profile launch across leading exchanges including Binance, OKX, Upbit, and Coinbase, current trading is at approximately 23 cents, reflecting a 24% drop on the day. The market cap now rests at around $6.39 billion, a dramatic fall from an initial valuation exceeding $40 billion at launch.
The governance proposal indicates that funds from WLFI’s liquidity on Ethereum, Binance Smart Chain, and Solana would be used to buy WLFI from the market, sending it to a burn address to permanently eliminate tokens from circulation.
“This program removes tokens from circulation held by participants not committed to WLFI’s long-term growth,” stated the team, suggesting that the design aligns the interests of long-term holders with the protocol’s development.
The initiative applies solely to fees from WLFI’s own liquidity and disregards contributions from third-party liquidity providers.
Another governance proposal is circulating among community members, aiming to auto-stake 80% of WLFI tokens that are locked, thereby turning idle supply into productive assets. Critics, however, assert that this plan merely redistributes rather than genuinely generates yield.
Despite market challenges and criticism from some stakeholders, WLFI continues to have prominent supporters, including Tron founder Justin Sun, who has publicly endorsed the project, emphasizing its importance in the cryptocurrency sphere and assuring he will retain his unlocked tokens.
