KEY POINTS
- Aside from $22.5 billion in $WLFI tokens, DT Marks DEFI LLC will also receive 75% of the protocol's net revenue
- The remaining 25% in protocol revenue will go to Axiom Management Group, owned by Chase Herro and Zachary Folkman
- Many crypto users noticed how the $WLFI tokens are non-transferable and can be burned by treasury
A "gold paper" published by Donald Trump-backed World Liberty Financial (WLFI) revealed that the majority of the DeFi protocol's net revenue will be allocated to DT Marks DEFI LLC, a company linked to the ex-president.
The paper also noted that the Republican presidential candidate and his family assume no liability, pointing out that WLFI tokens "are not political and have no affiliation with any political campaign."
A Significant Allocation for a 'Trump-Owned' Entity
According to The Washington Post, DT Marks DEFI LLC is owned by the GOP frontrunner. If WLFI becomes a success, Trump stands to benefit significantly, the outlet added.
Indeed, the crypto project's gold paper states that for the services and rights Trump will offer, such as promotion, "World Liberty Financial agrees that DT Marks DEFI LLC will receive $22.5 billion $WLFI tokens and a right to receive 75% of the net protocol revenues as defined in the services agreement after deduction of agreed operating expenses and the initial treasury reserve."
Axiom Management Group, which is wholly owned by Chase Herro and Zachary Folkman, two of WLFI's co-founders, will receive the remaining 25% of the protocol's net revenue.
Today’s the day! @WorldLibertyFi token sale is live. Get your $WLFI tokens now. Purchase $WLFI here: https://t.co/jg1tOaHHBy pic.twitter.com/j8ewxa13wp
— Donald J. Trump (@realDonaldTrump) October 15, 2024
Crypto Users Warn Community
Many cryptocurrency users have since expressed disappointment over the "red flags" they found in the WLFI's "gold paper," seemingly a play on white paper, a document that crypto token projects usually release before a token sale.
One user noted that the WLFI token will be "non-transferrable," meaning the tokens will be locked for the time being. On the allocations for the Trump family, the user said, "this status will probably never change through any voting for many years."
Pop Punk, the pseudonymous co-founder of token launch security platform G8keep, pointed out that the WLFI token's contract gives authority to the treasury "to burn anyone's tokens for any reason at any time."
World Liberty Financial token contract allows the treasury to burn anyone's tokens for any reason at any time. pic.twitter.com/xFhWPIiYZ7
— Pop Punk (@PopPunkOnChain) October 18, 2024
A 'Questionable Intent' for a Trump-Backed Project
Content creator Rypto covered the recent buzz within the crypto community over concerns they noticed about WLFI. He argued that with a project so big due to the backing of a former president, it was questionable why there were many red flags hounding the venture.
World liberty finance a project supposedly backed by @realDonaldTrump is raising serious concerns with many pointing out red flags that make it look more like a scam than a legitimate financial endeavour. @worldlibertyfi $WLFI pic.twitter.com/wBbRCvo1O9
— Rypto (@Rypto__) October 17, 2024
"U.S. citizens must earn over $200,000 a year to even be eligible [to join the whitelist], adding to the project's exclusivity and questionable intent," Rypto said.
Trump and WLFI previously encouraged crypto users to join the whitelist for the token sale earlier this week, but only accredited investors as defined by the SEC are allowed to take part in the token sale.
A 'Full-On Scam'
This isn't the first time World Liberty Financial was under scrutiny. Influential financier Anthony Scaramucci previously described the project as a "nonsense" venture.
"This is a full-on scam, and the problem with this thing is it hurts the industry, when people are doing nonsense like this," he said.
There were also earlier concerns about the WLFI code's similarity to Dough Finance, a similar venture that got exploited for over $2 million, but for now, the biggest issue crypto users have is the Trump-linked entity's massive revenue allocation.
