Trump Family Project: Nepotism, 70% Token Allocation to 'Insiders', Ultimate Goal to Replace Tether?

Original | Odaily Planet Daily (@OdailyChina)

Author | How about it? (@vincent 31515173)

As the US election approaches, Donald Trump, one of the presidential candidates, has attracted much attention recently. Especially World Liberty Financial, an encryption project led by Trump’s son, has gained attention from the encryption industry and even the global financial industry.

Recently, CoinDesk revealed many problems in the White Paper draft of the project, especially the unreasonable token allocation ratio and the centralization of governance structure, which seems to contradict the project’s previous claim of ‘returning the power of finance to the people’. World Liberty Financial subsequently responded to CoinDesk’s report, but apart from some irrelevant answers, there was no mention of governance and token allocation. This not only failed to dispel public doubts, but also backfired, further raising questions about the fairness of the project. (Note: The source of the White Paper draft is from Trump’s inner circle).

Odaily Daily Planet integrates existing market information to unveil the mystery of the World Liberty Financial project for readers.

70% Token allocation benefits related parties, favoritism

According to the draft of the World Liberty Financial White Paper obtained by CoinDesk, 70% of the governance token WLFI will be allocated to “internal personnel” such as founders, teams, and service providers, and the remaining 30% will be distributed through public sale. In order to avoid scrutiny by the US SEC and violation of securities laws, all WLFI tokens will not be transferable until they are unlocked through protocol governance procedures in a manner that does not violate relevant laws.

In other words, in the future, WLFI Token is highly unlikely to be able to enter the exchange for public trading, and can only be used as a governance token within the platform, with dividend rights pending. In a sense, WLFI may be similar to privately listed equity, only available for Over-the-counter Trading, requiring notification to the project managers for ownership changes.

The White Paper also reveals that the project is built on the ETH platform lending platform Aave, and plans to promote the widespread application of stablecoins and Decentralized Finance, helping the United States become the “global capital of encryption”.

In the report by CoinDesk, they heavily criticized the distribution of World Liberty Financial coin and quoted industry insiders as saying, “This is really a ridiculous joke” to mock the project’s centralized governance issues.

World Liberty Financial is also associated with Dough Finance, a lending project that was recently attacked by hackers. Many team members come from Dough Finance, and Dough founder Zak Folkman was formally registered as the owner of World Liberty Financial LLC. In addition, World Liberty Financial may have directly copied Dough Finance’s code in the early stages, making it difficult to determine whether the current code has certain bugs and raising concerns about the security of the project.

(Note: Dough Finance was attacked by Flash Loans on July 12, and the hacker profited about $2.1 million, of which approximately 76 ETH (about $260,000) has been returned by a white hat hacker. The attacker exploited a vulnerability in the Dough ConnectorDeleverageParaswap contract, allowing them to directly transfer WETH from the vulnerable contract.)

In addition to the Dough Finance team members, the Trump family will serve in multiple roles on the project,** with Trump being called the “chief Cryptocurrency advocate,” Trump’s two eldest sons serving as “Web3 ambassadors,” and Trump’s younger son serving as “Decentralized Finance visionaries.” **

Several frens of Trump also hold important roles in the project. For example, well-known real estate developer Steve Witkoff serves as the head of institutional investments, Steve Witkoff’s son Zach Witkoff serves as the head of intelligence, Alex Golubitsky, co-founder of the encryption governance consulting firm MetaleX Pro, serves as legal advisor, Gabriel Shapiro, co-founder of MetaleX Pro, serves as encryption governance advisor, Zak Folkman, founder of a dating platform, serves as the operations director, and Chase Herro, founder of venture capital firm Pacer Capital, serves as the head of digital and strategy. Together, they form the leadership team of World Liberty Financial.

Looking at the disclosed team members, it is hard not to question the professionalism of the project. After all, it is a replica development based on a stolen project, and team members are appointed based on personal relationships. Some members even have no relevance to the encryption industry.

Official response: Ensure project security

In response to CoinDesk’s disclosure, World Liberty Financial quickly responded.

The project team emphasized that they are cooperating with the world’s top security companies to ensure the security of the project code. These partners include well-known companies Zokyo, Fuzzland, PeckShield, and BlockSecTeam. The team stated, “We are aware of how important the project we are building is, and its potential impact on Cryptocurrency and our country, especially the upcoming elections. We dare not take it lightly. Security is a top priority, and we will adopt the best industry practices to ensure the safety of user funds.”

The project party also explicitly stated that it will cooperate with the well-known lending project Aave to create a brand new Decentralized Finance lending platform on the ETH network, and will launch a credit account system and a simple interface for convenient access to the project by Wallet or brokerage businesses. World Liberty Financial is not a fork of Aave, but a cooperation with Aave to promote innovation and development in the Decentralized Finance field. The project does not intend to replicate the existing Decentralized Finance protocol, but hopes to cooperate with it to jointly create a more powerful and secure Decentralized Finance platform.

In addition to clarifying the relevant controversies, World Liberty Financial also introduces the core goal of the project, which is to ensure that the US dollar continues to dominate the global finance in the future by promoting a stablecoin pegged to the US dollar. The project party believes that the global dominance of the US dollar is facing challenges from other countries, and the promotion of stablecoins will help maintain the United States’ leadership in the international financial field.

Team member Steve Witkoff said the project wants to provide lending access to people who are not approved by mainstream finance. ‘Decentralized Finance is open credit for those who are excluded. Our credit market is the best in the world, but still excludes many people from borrowing and pursuing the American Dream. When I started my business, I found someone who believed in me - my father, who lent me $20,000. Without him, I wouldn’t have my business. Free finance will provide more opportunities for people to pursue their dreams.’

From the response of World Liberty Financial, it did not reply to the controversial token distribution and governance issues, which may corroborate the authenticity of part of the White Paper draft obtained by CoinDesk. Its response only emphasizes the security and originality of its protocol, which may make it difficult for followers of this project and Trump to ‘buy in’.

Conclusion

Previously, the market had speculated about World Liberty Financial, with options ranging from CeFi to payments. After CoinDesk’s disclosure, World Liberty Financial finally reveals its mystery.

Although the project party has not responded directly to market doubts, judging from the composition of the team members, it is highly probable that the core equity of the project is controlled by the Trump family. The specific details will need to wait for the official announcement. Considering the recent unfavorable public opinion, the official White Paper may loosen up and give up more benefits.

One of the biggest challenges facing Project World Liberty Financial is that President Trump’s wife Lara Trump and youngest daughter Tiffany Trump’s X (formerly Twitter) accounts were hacked, and Hackers used these accounts to promote an encryption eyewash similar to the project name. Although the project party quickly issued a warning, reminding users not to click on any suspicious links, many people believe that the Trump family can’t even control their own Twitter accounts, so how can they ensure the security of the project they launch.

All these problems have made the encryption industry doubt the true purpose of the Trump family’s project. After all, existing information seems to indicate that World Liberty Financial does not have a good operational infrastructure, and simply relying on Trump’s Favourable Information remarks in the encryption industry may not be enough. Perhaps, it is hoped that Trump will be re-elected and use his political influence to enhance the project’s recognition, officially certify the project at the official level, and replace Tether’s market position with a large-scale issuance of the US dollar Stable Coin.