World Liberty Financial (WLFI) is a decentralized finance (DeFi) project with ties to the Trump family, launched in early September 2025. It aims to build infrastructure for stablecoins, payments, and decentralized exchanges on blockchains like Ethereum, BNB Chain, and Solana.
The project’s native token, $WLFI, has a total supply of 100 billion, with an initial circulating supply of around 27.3 billion after a significant unlock of 24.6 billion tokens shortly after launch. This unlock led to a 30% price drop from its all-time high of approximately $0.32, raising concerns about supply dilution and investor confidence.
On September 1, 2025, the WLFI community and governance team proposed a mechanism to allocate 100% of fees from protocol-owned liquidity (POL)—also referred to as LP (liquidity provider) fees—to buy back $WLFI tokens on the open market and permanently burn them.
This is not a full protocol-wide fee allocation; it specifically targets fees generated by WLFI-controlled liquidity pools, excluding those from community or third-party providers. The goal is to create a deflationary pressure on the token supply, rewarding long-term holders by reducing circulation over time.
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Applies only to fees earned by WLFI’s treasury-managed liquidity positions across multiple chains. For example, trading fees from WLFI’s own liquidity pools on DEXs like Uniswap or PancakeSwap would fund the buybacks.
Process
Collect fees from POL trades. Use 100% of those fees to purchase $WLFI tokens from the market (targeting short-term sellers to remove “weak hands”). Send the bought tokens to a burn address for permanent destruction, verified on-chain for transparency.
Manual operations with community-reported proofs on the blockchain, ensuring accountability. If approved, this serves as the foundation for a broader buyback-and-burn strategy that could incorporate other protocol revenues (e.g., from stablecoin issuance or lending) in the future.
With more protocol usage (trades, swaps), fees increase, leading to more buybacks and burns. This ties token value to platform growth. Aims to counter the post-launch sell-off by shrinking supply and boosting scarcity, potentially stabilizing or increasing $WLFI’s price.
Excludes third-party fees to avoid disrupting external liquidity providers, while prioritizing long-term holders. The proposal went live for voting on September 1, 2025, via WLFI’s governance platform built on a snapshot-style system. Voting is set to conclude on September 18, 2025.
Approximately 99.44% of votes around 1.2 billion tokens in favor, 0.13% against, and 0.43% abstaining. Official endorsement from WLFI’s team, who highlighted it as a way to “reduce circulating supply & reward long-term holders.”
On X (formerly Twitter), the proposal has generated significant buzz, with posts from influencers and media outlets like Cointelegraph and CoinDesk amplifying the news. For instance, WLFI’s official account posted: “Every trade = fewer tokens in circulation,” garnering over 7,000 likes.
If passed, which seems likely, implementation could begin immediately, with the first buybacks potentially using accumulated fees from the project’s early trading volume currently around $450 million in 24-hour.
$WLFI debuted with a $7 billion market cap but dipped post-launch due to the token unlock. The proposal announcement helped partial recovery, with the token trading around $0.22–$0.25 as of September 12.
The fully diluted valuation (FDV) stands at about 175,000 BTC. Supporters see it as a “deflationary engine” similar to successful DeFi projects like Raydium or Hyperliquid, which have burned billions in tokens. It aligns with WLFI’s pro-crypto, anti-inflation narrative, potentially attracting mainstream adoption.
Only POL fees are included, which may generate modest initial funds compared to total protocol revenue. Critics argue it won’t offset the massive supply if trading volume doesn’t surge. Relies on high usage; low activity could mean minimal burns, slowing treasury growth.
Accusations from figures like Justin Sun (Tron founder) claim WLFI froze 2.9 billion tokens, adding controversy. Some view the buyback as a targeted move against short-term holders like Sun. As a politically linked project, it faces scrutiny over centralization risks and whether the burn truly benefits retail investors versus insiders.
This proposal fits into a larger trend in DeFi where projects use revenue for tokenomics improvements to combat dumps and build loyalty. WLFI’s next steps include launching a USD stablecoin (USD1) and expanding governance.