On September 16, 2024, Donald Trump announced his decentralized finance (DeFi) venture called World Liberty Financial, although details on the project are still fairly sparse.
The project is apparently a family business with Eric Trump and Donald Trump Jr. getting positions as Web3 ambassadors and Barron Trump as DeFi visionary.
Trump said, “We’re embracing the future with crypto and leaving the slow and outdated big banks behind.”
The project has already received a considerable amount of criticism from mainstream media and crypto insiders alike.
World Liberty Financial Platform
Though it’s not exactly fully clear what this new DeFi platform will offer, it’s supposed to be a platform for borrowing and lending, and it may be built on Ethereum. It will have its own token called WLFI, which is a governance token that is non-transferrable. It’s being marketed as a solution to the current financial system.
The above is about the extent of what is known about the project, other than a couple key points which we’re about to discuss below, namely, who is behind the project, and what is contained in the white paper.
Cash-Grab? Scam? Things to Consider
The first thing to consider when looking at this “project” is the distribution of the WLFT token. According to the white paper, 70% of the initial tokens will go to the team behind the project, leaving just 30% for public sale.
This makes it extremely easy to both manipulate the price by having a false sense of scarcity, not to mention the fact that these are governance tokens, meaning the team will always be able to out-vote the entire community.
Oh, and the team gets proceeds from the initial sale of those initial tokens made available for public sale. For reference, most crypto project teams account for 20% of an initial token allocation, not 70%.
The white paper classifies Donald Trump as “chief crypto advocate”, while his sons are each “Web3 Ambassadors”. Then there’s 18-year-old Barron Trump, who is a college freshman with no known crypto expertise and is listed as “chief DeFi visionary” in the white paper.
Shady “Dirtbag of the Internet” Behind World Liberty
If the above information wasn’t enough to make you wary of this Donald Trump-led crypto project, perhaps a discussion of Chase Herro, the person behind “data and strategies” for the project, will be.
Herro has previously referred to himself as “the dirtbag of the internet”, who should be kicked out by regulators. He’s never led a successful project, but has led quite a few projects that were essentially scams and rug pulls, such as Dough Finance.
He has in numerous instances over the past 5+ years, talked about how “You can literally sell s— in a can, wrapped in piss, covered in human skin, for a billion dollars if the story’s right, because people will buy it,” when referring to the crypto sector.
It’s hard to imagine that someone who has talked in this way about both his own actions and the overall cryptocurrency sector, is doing anything in the interest of a greater good. Let alone a world-changing financial application.
Making money quickly seems a more likely objective for Herro.
Herro’s business partner, Zachary Foreman is also listed on the white paper as “operations lead”. Foreman’s claim to fame is running a service called Date Hotter Girls, where he taught seminars about how to pick up women.
Could Trump’s Project Set Crypto Back?
If the project turns out to be as much of a dumpster fire as it looks like from the outset, then it could be a really bad thing for the cryptocurrency sector. It wouldn’t be a good look for a former president to launch a crypto project, if you can call it that, and ostensibly scam most of his followers by tricking them into buying into what is almost certainly just a way to make money for him and his family.
With crypto already having too much of a reputation for being a place wrought with scams and bad actors, a bad actor of this scope could certainly have a negative effect on investor sentiment towards digital assets.
Closing Thoughts
It will be interesting to see what happens if and when this project launches, as it seems like a bad idea that shouldn’t be allowed to come to market.
It seems probable that those who are unlucky enough to invest in this project will lose money, leading one to wonder why the SEC hasn’t stepped in yet. Perhaps it will after launch, but that may be too late.
That’s not to say the project won’t have value as a memecoin proxy (especially if Trump wins the election) but proceed with extreme caution on this one.
