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World Liberty Financial, the decentralized finance (DeFi) system endorsed by former President Donald Trump, has revealed that its $300 million crypto token offering is mainly aimed at international investors.
So far, less than 350 US investors have been involved in the project, raising questions about its domestic appeal in the midst of a regulatory review led by the US Securities and Exchange Commission (SEC).
Offshore Focus of World Liberty Financial
Operating out of Wilmington, Delaware, however managed from Puerto Rico, World Liberty most recently put in a notice and American regulatory agencies, announcing its intention to sell tokens worth $30 million only in the United States.
When this limit is reached, the crypto venture company plans to stop the US offering, despite having an estimated value of $288.5 million. WLF tokens still available for sale.
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Zachary Folkman, the founder of World Liberty, indicated in a September interview broadcast on X (formerly Twitter), that the company plans to use Regulation S – a provision that allows the sale of tokens to non-US investors without the requirements set by the securities laws of -US.
I limited interest from US investors may stem from the SEC’s strict approach to cryptocurrency regulation, which has prompted many token issuers to focus their efforts overseas.
Trump’s involvement, as well as that of his sons, Donald Jr. and Eric, featured prominently in the company’s books. However, the document clarifies that their names are included “for informational purposes” and does not imply official endorsement of the donation.
Capitalizing on the Complexity of the Crypto Landscape
During a September interview, Folkman discussed the possibilities non-American sales by Regulation S, but declined to explain the distribution of tokens between domestic and foreign buyers.
US investors have been questioned about a different regulatory approach—Act D—that allows companies to raise unlimited capital to accredited investors, defined as people with more than $1 million in capital, without a primary residence.
Both Regulation D and Regulation S are designed to be organized raising money corporate processes. However, Regulation D imposes stricter investor protection and disclosure requirements.
For example, companies using Regulation D must publicly disclose information about the offering, including the total amount raised and the number of participating investors. Folkman noted the need to ensure that US buyers meet the approved criteria for investors, a process that adds another layer of complexity to the offering.
As of October 15, World Liberty reported that it raised $2.7 million under Regulation D by selling tokens to 348 investors. In contrast, statistics from Kaiko show that about 17,000 are different addresses have owned at least once, suggesting a broader interest that may not be reflected in US-only sales.
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The difference between US and offshore sales may be due in part to the anonymity implied by Regulation S, which does not require private companies to disclose information on raising funds or verify the financial status of buyers.
However, the law mandates that the offering be limited to non-US persons, ensuring compliance with international investment laws.
Folkman emphasized the company’s commitment to regulatory compliance during his interview, saying, “We would expect that any potential US token sale would be limited to non-US persons and subject to the restrictions in effect under what is known as Regulation S.”
Featured image from DALL-E, chart from TradingView.com
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