World Liberty Financial, backed by the Trump family, has proposed using 5% of the project’s WLFI token treasury to increase the supply of its USD1 stablecoin.
The proposal was posted on World Liberty Financial’s governance forum on Wednesday, with the team emphasizing the importance of increasing the $1 supply to keep up with “an increasingly competitive stablecoin landscape.”
The proposal highlights that the additional offering would help spread “USD1 use cases in select high-profile CeFi and DeFi partnerships,” with increased adoption helping to create more “value capture” opportunities in the WLFI ecosystem.
“As USD1 grows, more users, platforms, institutions, and chains integrate into World Liberty Financial’s infrastructure. This increases the scale and influence of the network governed by WLFI holders,” the team said.
“More than $1 in circulation drives increased demand for WLFI-governed services, integrations, liquidity incentives, and ecosystem programs,” he adds.
Source: Liberty Global Financial
World Liberty Financial’s WLFI token began trading on exchanges in September. Before the launch, the draft indicated that 19.96 billion of the total WLFI supply would be allocated to the Treasury. At current prices, that total sum is worth almost $2.4 billion, with a 5% unlock equating to around $120 million.
The team presented three potential voting options in the proposal: for, against or abstain. Voting is now live, but it’s not clear how it will take place.
Reactions to the proposal are currently mixed, with “against” slightly ahead of those indicating support for the proposal.
Community responses to the proposal. Source: Liberty Global Financial
The project’s stablecoin was launched in March and has a market capitalization of $2.74 billion according to CoinGecko data, making it the seventh largest US dollar-pegged stablecoin on the market.
Releasing 5% of the treasury can help stimulate asset growth; However, it has a lot of catching up to do if it is to supplant its competitors, with sixth-place PayPal’s PYUSD having a market cap of $1.1 billion above $1.