World Liberty Financial to Launch on Aave V3: What to Know

Donald Trump’s decentralized finance (DeFi) venture, World Liberty Financial, aims to launch on Aave’s Ethereum mainnet. This collaboration seeks to establish a platform that sets new standards and advances the entire DeFi sector.

World Liberty Financial officially launched on September 18 with much attention. However, doubts persist regarding WLFI’s unclear business model and tokenomics.

Trump’s DeFi Venture to Bring WLFI to Aave Ethereum Mainnet

In a recent governance proposal, World Liberty Financial (WLFI) revealed its intention to launch on Aave v3. This, according to the proposal, would allow the DeFi venture to provide liquidity for Ethereum, Wrapped Bitcoin, and stablecoins. It could also extend to other digital assets.

“We’re excited to announce that World Liberty Financial has officially posted our governance proposal to Aave’s forum to launch an Aave V3 instance on Ethereum Mainnet,” WLFI shared.

Trump’s WLFI venture also aims to leverage its marketing efforts to promote DeFi to a wider audience. This includes a new class of users to over-collateralize borrowing and lending. It will capitalize on Aave’s heft as a market leader in decentralized lending to offer seamless user experiences for supplying and borrowing against digital assets.

Read more: Top 11 DeFi Protocols To Keep an Eye on in 2024

The DeFi venture will use the same reserve factor system as the main Aave instance. Similarly, the Aave DAO will receive 20% of the protocol fees generated by the World Liberty Financial Aave v3 instance. These plans suggest a symbiotic relationship between the World Liberty Financial and Aave protocols.

This integration could grow the Aave protocol’s user base. Aave DAO will also receive around 7% of the total supply of WLFI tokens. The token’s use cases range from governance and liquidity mining to promoting the decentralization of the WLF platform. Additionally, a revenue split would be established using a trustless smart contract.

World Liberty Financial also envisions onboarding assets that are otherwise incompatible with the main market on Ethereum Mainnet. To do this, it will leverage its ties to traditional finance (TradFi) and institutional investment. Whether all these will become actualized depends on the Aave DAO governance and the WLFI community giving their approval.

The intention to integrate with Aave was first demonstrated in early September, two weeks before the DeFi venture’s official debut. The platform said it wanted to make crypto and America great by driving the mass adoption of stablecoins and DeFi.

“We’re not just another hostile fork of Aave. History shows those don’t work. We’re working with Aave, collaborating to create a platform that sets new standards and pushes all of DeFi forward,” World Liberty Financial revealed.

As BeInCrypto reported, the launch failed to impress crypto investors despite doubts about the project’s viability. There was skepticism about its business model. This includes how WLFI would operate and who its target customer base would be. Other concerns include how its decentralized lending protocol would generate revenue.

Perhaps the latest governance proposal could answer some of these concerns as the Aave DAO governance and WLFI community prepare to vote.

Read more: What Is Aave?

Nevertheless, the Aave community has yet to express optimism about the integration. This is evident as the AAVE token is down 0.46% in line with the broader market lull. BeInCrypto data shows it is trading for $142.18 as of this writing.