Key Takeaways
- World Liberty Financial (WLFI), the crypto project affiliated with President Donald Trump, completed a $1.06 million token buyback and burned $1.43 million worth of WLFI.
- The funds for the buyback were generated from fees and liquidity earnings on the project’s decentralized finance (DeFi) activities, following a community-approved governance proposal.
- The burn aims to reduce the token’s circulating supply and increase scarcity, countering the 33% price drop the token experienced over the last month.
World Liberty Financial (WLFI), the DeFi project associated with the Trump family, executed a significant token burn, permanently removing 7.89 million WLFI tokens, valued at approximately $1.43 million, from circulation.
This action followed a $1.06 million buyback campaign conducted across the BNB Smart Chain and Ethereum networks, funded entirely by fees and liquidity earnings generated from the project’s own DeFi ecosystem.
WLFI’s Tokenomics Strategy Gains Approval
The decision to implement a recurring buyback and burn mechanism was ratified by an overwhelming majority of WLFI holders through a governance vote, with 99% approving the proposal.
WLFI Treasury Liquidity Fees for Buyback & Burn Proposal Results
This strategy is a cornerstone of modern tokenomics, designed to mimic stock buybacks in traditional finance. Its core goal is to reduce the total supply of a token, thereby creating scarcity that, in theory, exerts upward pressure on its value if demand remains constant or increases.
Under the plan, 100% of the fees generated from WLFI-managed liquidity pools—excluding community and third-party pools—are systematically used to repurchase the WLFI token on the open market. These purchased tokens are then sent to a burn address, an inaccessible wallet that effectively destroys them.
This transparent, programmatic mechanism is intended to reduce the circulating supply, alleviate persistent selling pressure, and bolster confidence among long-term holders, whose proportional ownership increases with every successful burn.
The team still holds 3.06 million WLFI, worth about $638,000, on the Solana network, with further action pending.
The Financial Leverage of Trump Family’s WLFI Holdings
The backdrop to this tokenomics strategy is the immense, albeit unrealized, wealth held by Trump-linked entities. An entity tied to President Donald Trump and his family controls approximately $5 billion worth of WLFI following a scheduled unlock of 24.6 billion tokens earlier this month.
The project’s website lists DT Marks DEFI LLC and family members like Donald Jr., Barron, and Eric as initial holders of 22.5 billion WLFI, which constitutes roughly 22.5% of the total token supply.
It is important to note that the tokens held by the Trump family are subject to lock-up conditions and cannot be sold, meaning the $5 billion valuation is on paper only.
Final Thoughts
The successful execution of the WLFI buyback and burn demonstrates the team’s commitment to its community-approved tokenomics plan. While the mechanism aims to stabilize the token’s price through scarcity, the long-term success of the WLFI project will ultimately depend on expanding the utility of its DeFi ecosystem and navigating the intense political scrutiny surrounding the Trump family’s massive crypto holdings.
Frequently Asked Questions
What is a “buyback and burn”?
A buyback and burn is a tokenomics strategy where a project uses revenue to buy its tokens on the open market and then permanently removes them from circulation to increase scarcity and support the token’s price.
How did WLFI fund the buyback?
The buyback was funded by a portion of the fees and liquidity earnings generated from the WLFI project’s decentralized finance (DeFi) activities.
Is the Trump family selling their WLFI tokens?
No. The Trump family’s allocation of WLFI tokens is currently locked under a vesting schedule and cannot be sold, meaning their reported $5 billion valuation is an unrealized, on-paper figure.
