Trumps’ World Liberty Financial Proposes Aave V3 Deployment On Ethereum

World Liberty Financial, the highly-anticipated DeFi protocol from the Trump family, wants to launch an Aave v3 instance on Ethereum.

On Oct. 9, World Liberty Financial published a preliminary temperature check proposal to the governance forum of Aave, the largest DeFi money market, to deploy a version of Aave v3.

The proposal describes World Liberty Financial as a protocol facilitating deposits and lending in the form of Ethereum (ETH), Wrapped Bitcoin (WBTC), stablecoins, and potentially other digital assets. The protocol would initially support deposits in the form of Tether’s USDT and Circle’s USDC stablecoins alongside ETH and WBTC.

“WLF foresees onboarding assets that may not be compatible with the main market on Ethereum Mainnet, leveraging its ties to traditional finance and institutional investment,” the proposal added.

Aave would earn 20% of protocol fees generated by the Aave v3 instance and receive roughly 7% of the supply of World Liberty Financial’s WLFI token to participate in governance and liquidity mining.

World Liberty Financial said it aims to “promote DeFi to a wider audience” and “introduce a new class of users to over-collateralized borrowing and lending.”

Should the proposal attract support, it would escalate to a snapshot vote, before moving to an Aave Request For Comment (ARFC) to gather further feedback from the Aave community, and lastly taking the form of an Aave Improvement Proposal (AIP). The proposal is also subject to governance approval from the Aave DAO and World Liberty Financial’s community.

Community support

Aave community members have responded favorably to the proposal.

Marc Zeller, the founder of the Aave Chain Initiative, a service provider to the Aave DAO, said the ACI “fully supports” the initiative and “welcomes alignment between the WLF and the Aave ecosystem.”

“I am very curious to see how this new instance will evolve and what kind of new user base will be onboarded to Aave,” added EzR3aL, an Aave forumgoer. “Revenue share and token sharing seems fair and signals that a good relationship is important for WLF.”

World Liberty Fi

The proposal follows months of anticipation for World Liberty Financial, with the Trump family consistently announcing details regarding the project since August.

On Aug. 7, Donald Trump Jr. vowed to soon “shake up the crypto world” and touted decentralized finance on social media. During a Q&A session on the following day, Donald Jr. said the project would comprise a DeFi platform aiming to “take on a lot of the banking world.”

On Sept. 3, World Liberty Financial announced it was working closely with Aave to launch a platform that would drive “mass adoption of stablecoin and decentralized finance.”

The announcement came one day after a now-deleted GitHub whitepaper suggested World Liberty Financial was based on Dough Finance — a protocol that was hacked for $2.1 million in July. Four of Dough Finance’s developers are also listed among World Liberty Financial’s team members.

On Sept. 16, World Liberty Financial announced plans to issue WLFI through a token sale. The team noted that WLFI will comprise a non-transferable governance token, with the sale exclusively available to U.S.-based accredited investors.

Aave outperforms

The news comes as Aave is outperforming the broader DeFi market, with the protocol’s total value locked (TVL) increasing by 82% year-to-date to beat out the sector’s average by roughly double.

Aave is now the second-largest DeFi protocol overall with more than $12 billion in TVL, according to DeFi Llama. The price of AAVE is also up 30% since the start of 2024 at $141.7, while the market cap of DeFi tokens is down 5.44% over the same period, according to CoinGecko.

On Oct. 9, Sky (formerly MakerDAO), a protocol that has recently publicly clashed with Aave, launched rewards incentivizing the adoption of its new USDS stablecoin on Aave.