The Trump family-supported World Liberty Financial has suggested allocating 5% of the project’s WLFI token treasury to expand the supply of its stablecoin USD1.
This proposal was submitted to the World Liberty Financial governance forum on Wednesday, with the team emphasizing the need to increase USD1 supply to compete in “an increasingly competitive stablecoin landscape.”
The proposal states that the additional supply would facilitate “USD1 use cases across selected prominent CeFi & DeFi partnerships,” with increased adoption creating more “value capture” opportunities within the WLFI ecosystem.
“As USD1 grows, more users, platforms, institutions, and chains will integrate with World Liberty Financial’s infrastructure. This augments the scale and influence of the network governed by WLFI holders,” the team noted.
“A larger circulation of USD1 boosts demand for WLFI-governed services, integrations, liquidity incentives, and ecosystem programs,” they further stated.
The WLFI token from World Liberty Financial began trading on exchanges in September. Prior to the launch, the project indicated that 19.96 billion of the total WLFI supply would be directed to the treasury. At current market prices, this amounts to nearly $2.4 billion, with a 5% unlock translating to about $120 million.
The proposal includes three potential voting options: for, against, or abstain. The voting is currently active, but the exact voting process remains unclear.
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Reactions to the proposal are mixed, with “against” slightly surpassing those who support it.
Launched in March, the project’s stablecoin boasts a market cap of $2.74 billion according to data from CoinGecko, positioning it as the seventh-largest USD-pegged stablecoin in the market.
The 5% treasury unlock could catalyze asset growth; however, it faces significant competition, with PayPal’s PYUSD holding a market cap that exceeds USD1 by $1.1 billion.
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