Trump’s crypto coin for sale on Election Day just three weeks out

With shares of his fledgling telecommunications business in the midst of a massive rally and with the presidential election just three weeks away, Donald Trump is bringing his latest proposed attempt to capitalize on the market, this time through crypto.

On Tuesday, the former president and current Republican nominee intends to launch WLFI, a token associated with his new crypto project called World Liberty Financial. Over the weekend, Trump touted the sale in a post on X, telling his supporters it was “an opportunity to help shape the future of finance.”

Potential investors could be forgiven for having little idea of ​​what they are being asked to support.

People involved with WLF described it as a type of crypto bank, where customers will be encouraged to borrow, borrow and invest in crypto. No official white paper or official business plan has been released to the public, and about all that has been revealed is that investing in the project will give users voting rights through the yet-to-be-launched WLF platform.

In the road offered to potential investors that was first seen by The Block, the WLF proposal states that the coin is looking to raise $300 million at a cost of $1.5 billion in its initial sale. CNBC reached out to WLF for comment but did not receive a response.

World Liberty Financial is diverse and unique Trump Media & Technology Groupthe parent company of social media platform Truth Social. Trump Media, known by the ticker symbol DJT, began trading in March, after going public as a special purpose acquisition company (SPAC). It’s been a rocky road for the stock, which peaked around $80 in late March, before falling to $12.15 last month.

But since the beginning of September 23, DJT shares are close to 150% to $ 29.95, which gives the company a market capitalization of 6 billion. That’s on revenue of less than $1 million per quarter and after the company lost more than $16 million in the most recent period.

While DJT shares can be purchased by anyone, the digital coin WLFI will be a Regulation D token offering, following a provision that makes it possible to raise capital without first registering a security with the SEC. Certain conditions must be met, such as limiting the size of the auction and limiting it to accredited investors, defined in part as a total amount of more than $1 million.

Trump owns about 57% of DJT’s outstanding shares, but his control over World Liberty Financial is very clear. The WLF website, which is currently the landing page for signing up for identity-your-customer verification to purchase the coin, includes some documentation that shows the founders’ financial incentive.

Founder Zachary Folkman, who once owned a company called Date Hotter Girls and reportedly helped develop the crypto project Dough Finance, said 20% of WLF tokens will be allocated to the founding team, which includes the Trump family.

And it seems there is another way they can make money.

“DT Marks DEFI, LLC and its affiliates including Donald J. Trump and members of his family own tokens or may receive tokens from World Liberty Financial, and will be entitled to receive significant fees for services provided by World Liberty Financial, which are undecided yet,” the website said.

On Monday, less than 24 hours before the planned token launch, the WLF team called a chat on X Spaces to share details of the sale. About 12,000 people tuned in to listen to a more than hour-long discussion about the project’s main goals.

Folkman reiterated what he said at a previous Spaces event, telling attendees that WLFI is a management symbol that allows executives to vote on decisions related to the protocol, including programs such as advertising partnerships. He said token ownership “is not equality” and “does not represent an economic right.”

Folkman said the token sale will only take place on the World Liberty website, and that only those who were authorized after registration will be able to participate. He said “more than 100,000 people” are on the white list and said it is not too late to register. Folkman added that WLF will publish the project’s “long-awaited” roadmap on Tuesday, in conjunction with the token sale.

Last week, WLF began the process of getting its crypto bank approved by the decentralized finance (DeFi) ecosystem known as Aave.

Aave is open source and, in DeFi, one of the longest-running and most trusted crypto-lending platforms.

“The regulation itself is unlicensed, so I don’t have the slightest idea about coordination, because it’s the whole concept of financial separation,” Aave founder Stani Kulechov told CNBC in an interview at the Permits Summit in Salt Lake City, Utah.

Kulechov joined Monday’s X event and said he was “happy that WLF uses and relies on “Aave.

“That’s a strong sign that what we’re building is useful, so we’re very happy,” he said.

In a 400-word document on Aave’s governance forum, the WLF team presented a brief outline of its goals, which include promoting “DeFi to a wider audience through its marketing efforts,” and introducing “a new class of users in highly integrated lending. and lending.” The proposal is currently in the first consideration phase known as “Temp Check,” and Aave users are able to comment on the program.

In the comments section, several users raised concerns about the project’s deep ties to the Trump family.

“I believe this proposal poses a significant risk to the Aave protocol for the benefit of a small amount of money,” according to the deleted comment. The commenter then questioned the reason for having “the largest and most trusted protocol in DeFi” working with a group led by “people of questionable backgrounds … including several convicted criminals.”

Folkman helped start the WLF with longtime business partner Chase Herro. CoinDesk reported that the pair previously worked at Dough Finance, which was also built on top of Aave and suffered a $2 million hack in July. Herro also launched another crypto trading business ten years ago called Pacer Capital, which seems to be defunct.

In order for World Liberty to proceed, it must go through several rounds of consideration and approval, each decided by a vote among the existing AAVE token holders.

At this stage of the process, the token sale is similar to an IOU. Those who buy now have a claim on the token if and when the platform is approved and launched.

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