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World Liberty Financial, the DeFi project backed by Donald Trump Jr. and Eric Trump, has voted to allocate at least 5% of its governance token treasury to accelerate adoption of its USD1 stablecoin, which has reached $3 billion in circulation six months after launch—while completing a $10 million token buyback and securing $300 million in market maker liquidity.
The governance vote, which passed this week despite significant opposition from token holders, comes as the Trump-family venture aggressively pushes its dollar-pegged stablecoin into both centralized exchanges and DeFi protocols amid questions about whether growth is organic or incentive-driven.
WLFI said the treasury allocation will be used to strengthen strategic partnerships across both CeFi and DeFi, incentivize integrations, and expand the real-world use of USD1. While USD1 is positioned as the ecosystem’s primary product, WLFI functions as the governance and coordination layer underpinning all current and future offerings.
“USD1 is our growth engine, but WLFI is the connective tissue of the ecosystem,” a World Liberty Financial spokesperson said in a statement. “Expanding USD1’s reach ultimately increases demand for WLFI-governed services, integrations, and liquidity programs.”
According to the company, more USD1 in circulation translates into greater economic activity across chains and platforms, pulling more users and institutions into the WLFI-governed network.
As adoption expands, WLFI token holders gain governance authority over a broader ecosystem, including decisions on incentives, product rollouts, and cross-chain strategy.
The company emphasized that any additional use of WLFI treasury assets for USD1 growth will require separate governance approvals, signaling an effort to reassure investors wary of unchecked treasury spending.
The proposal passed following a community poll, but voting revealed a sharply divided investor base. Supporters argue that deploying a portion of the treasury is a pragmatic way to reward partners and accelerate ecosystem development.
“This is a smart way to give back to builders who are actually using USD1,” one WLFI investor wrote in the poll discussion. “Targeted incentives can unlock innovative products and deepen liquidity where it matters.”
Some proponents suggested directing funds toward decentralized exchanges on Ethereum and Solana, as well as selective centralized exchange partnerships and ecosystem tokens paired with USD1. Others proposed strategic exposure to meme-linked liquidity pools to drive retail adoption.
However, a significant bloc of voters opposed the move, recommending instead that up to 80% of the total WLFI token supply be unlocked and retained in the treasury. Critics warned that aggressive deployment could weaken long-term treasury resilience and expose the protocol to governance risk.
“Stablecoin growth funded by governance tokens can create short-term momentum, but it also concentrates risk,” said an independent DeFi analyst who reviewed the proposal. “Investors will be watching closely to see whether USD1 demand is organic or incentive-driven.”
Alongside the treasury allocation, WLFI confirmed it has completed a $10 million WLFI token buyback using USD1, executed over a three-week period.
The protocol purchased WLFI tokens directly from the open market, a move designed to support the governance token’s value while simultaneously increasing USD1’s transactional utility.
“This buyback demonstrates a closed-loop model where the stablecoin directly reinforces the governance layer,” said the WLFI spokesperson. “It aligns long-term holders with the ecosystem’s growth.”
The buyback follows a separate governance vote and marks one of the most significant capital deployments by the project to date.
For investors, the move highlights WLFI’s strategy of tying stablecoin expansion to token value support an approach increasingly scrutinized across DeFi markets.
Additional attention has focused on revelations that crypto market maker DWF Labs has been providing substantial liquidity support to USD1.
Blockchain analysis published by Disruption Banking suggests that DWF Labs funneled more than $300 million in engineered liquidity through WLFI’s TokenGovernor contract, with $84 million injected in the past month alone via a multi-layered, cross-chain structure.
While these flows were not previously reported, DWF Labs has publicly acknowledged purchasing $25 million worth of USD1, much of which later appeared on Binance.
A DWF Labs representative declined to comment on specific wallet activity but reiterated the firm’s “long-term interest in supporting high-growth onchain financial infrastructure.”
Institutional momentum also appears to be building. The Cantor Network recently announced plans to deploy USD1, a move WLFI described as a major step toward broader adoption among regulated market participants.
“Institutional integration is the next frontier for stablecoins,” said a digital assets strategist at a global trading firm. “If USD1 can balance governance discipline with liquidity depth, it could become a serious competitor in the dollar-backed stablecoin market.”
For crypto investors, WLFI’s latest moves present both opportunity and risk: rapid growth backed by aggressive capital deployment, tempered by governance tensions and increasing scrutiny over how that growth is funded.
