Trump Family’s DeFi Platform World Liberty Financial is No Political Stunt, Says Advisor

The Trump family’s latest entry into crypto, World Liberty Financial (WLFI), a decentralized finance (DeFi) project, has led to speculation that it might be a political maneuver to win over the crypto vote.

Ogle, a pseudonymous security advisor to WLFI, denies that’s the case.

“It probably isn’t the wisest choice if it is a political stunt, given the negative attention the project would get,” Ogle told The Defiant. “There are easier ways to win over the crypto crowd. Trump could just say nice things about crypto at a conference and get a bunch of donations without the hassle of launching a whole project that comes with significant risks.”

WLFI did not respond to The Defiant’s request to comment.

Trump, who once called Bitcoin a “scam” in 2021, seems to have changed his tune. He has been aggressively courting the crypto vote in recent months, even advocating for the U.S. to lead the global Bitcoin mining industry.

Not everyone is convinced, though. Anthony Scaramucci, former White House Communications Director under Trump, said he’s skeptical about Trump’s true intentions behind WLFI.

“It’s nothing — it’s all based on thin air,” Scaramucci told The Defiant. “He is definitely trying to court crypto votes.”

Scaramucci, who is working with Kamala Harris to shape her campaign’s digital asset policies ahead of the November presidential elections, also noted that Harris' team believes they’ve "gone too far left on crypto" and intends to adjust their stance after the election.

The U.S. Securities and Exchange Commission (SEC), led by Gary Gensler, has had a "regulation by enforcement" approach to crypto, refusing to set clear rules for the industry while still cracking down on its participants – even those trying to operate in a compliant way. The SEC has filed lawsuits against several exchanges, including Binance, Coinbase, and Kraken, among others, for allegedly operating as unregistered securities exchanges.

When asked why the crypto enforcement issue should be addressed after the election, Scaramucci added, “They (Kamala Harris’ team) have bigger fish to catch for now.”

‘Similar to Aave’

Ogle said that WLFI will be a DeFi platform that would facilitate borrowing and lending, similar to Aave, the second largest DeFi protocol with $20 billion in total value locked (TVL).

On Oct. 9, WLFI submitted a governance proposal to AaveDAO, proposing to launch as an Aave v3 instance on Ethereum’s mainnet. Aave would serve as the platform’s back end, providing liquidity for stablecoins like USD Coin (USDC) and Tether (USDT), as well as major cryptocurrencies like Ether (ETH) and Wrapped Bitcoin (WBTC).

WLFI also proposed giving AaveDAO 20% of the fees generated by the platform and 7% of its governance token supply, WLFI. If the Aave integration is successful, WLFI noted that it plans to expand to Ethereum's Layer 2 blockchain, Scroll.

“This project will likely bring in a lot of people who are new to crypto, and my job is to make sure that they’re protected,” Ogle added.

Earlier this year, Ogle helped recover $1.8 million from a hack on Dolomite, a crypto exchange. It was during this process that Corey Caplan, Dolomite’s co-founder and now an advisor to WLFI, introduced Ogle toZachary Folkman and Chase Herro, who oversee operations and strategy at WLFI.

“I think stablecoins are the easiest way to onboard new users, especially since they’re just digital dollars. It's less intimidating than jumping into volatile assets like Bitcoin. So, I think stablecoins are the starting point, but there’s definitely room for the platform to expand as it grows,” Ogle noted.

Main Motivation

The primary motivation behind WLFI, according to Ogle, stems from the Trumps’ frustration with being “debanked.” Ogle said that the Trump family has faced challenges accessing standard banking services, such as loans, due to their name.

During a Sept. 16 X Space, Donald Trump Jr. referenced his family's alleged experience of being "debanked."

"We could have picked up the phone and called any CEO of any bank and gotten a loan," Trump Jr. said. "Then we got into the political arena and like that, it was turned off."

Trump Jr. described an incident involving PNC Bank, where one of his businesses was suddenly cut off without explanation.

"It wasn't that we didn't have incredible balance sheets... They broke up with us by mail,” the former president’s son said.

Token Sale ‘By the Book’

The upcoming WLFI token sale, which will distribute nearly 63% of its non-transferable governance tokens, is restricted to accredited investors — a move driven by regulatory concerns.

Ogle said that WLFI is doing everything "by the book" to ensure compliance with U.S. federal securities law.

"Making DeFi easier doesn’t necessarily mean making investments easier. Those are two different things. I understand the concern, but what’s the alternative? Are they supposed to break the law and go to jail?” Ogle said. “They’re doing it by the book. They can’t take money from non-accredited investors or people outside the U.S. That’s how it goes.”

He added, “The Trumps will likely point out that this highlights the need to replace Gary Gensler with someone who will create more common-sense rules.”

On Sept. 17, Folkman also reiterated that the decision to limit the sale to accredited investors was driven by regulatory concerns.

"Although we don’t consider WLFI to be a security, in light of regulatory uncertainty surrounding tokens and token sales in the United States, we’ve decided it’s prudent to limit the token sales to certain persons who would be eligible to participate in transactions that are exempt from registration under the U.S. federal securities law," Folkman said.

Enrollment for WLFI officially started on Sept.30, with Trump announcing the beginning of Know Your Customer (KYC) verification. Due to what WLFI describes as “outdated” regulations, the whitelist is available only to accredited U.S. investors for now, as confirmed by the project’s Telegram channel. A second whitelist will soon open for non-U.S. investors.

Security A ‘Big’ Focus

Folkman and Herro, who oversee operations and strategy at WLFI, have a controversial history.

They were previously involved with Dough Finance, a DeFi project that fell victim to a flash loan attack in July, resulting in hackers siphoning off $2 million. In 2024, DeFi platforms collectively lost over $1 billion, according to data from DeFiLlama.

Herro promoted a token on influencer Logan Paul’s podcast that plummeted by 95%. He is also the face behind a members-only trading group called "Watchers," where he charges $149 a month to share his trading insights.

Herro, who describes himself as the "dirtbag of the internet" partnered with Folkman, who once ran a company that gave advice on dating under the name "Date Hotter Girls." A report from NYT highlights that the duo have a habit of jumping from one venture to the next, forming at least 17 companies between them, often setting up shop in tax havens like the U.S. Virgin Islands and Puerto Rico.

WLFI is prioritizing security, especially after its founders’ previous crypto ventures were marred by hacks, said Ogle.

“They’re (the founders) getting several audits — my understanding is that four different audits are being conducted on the code,” Ogle said. “The founders have been involved in previous projects that got hacked, so they’re quite sensitive to the risks. They’re putting processes in place to make sure no one person has full control, reducing the risk of a single point of failure.”