WLFI Faces Backlash as Team-Linked Wallets Sway USD1 Vote
World Liberty Financial (WLFI) is under scrutiny after a governance vote approved a USD1 growth proposal, drawing objections from community members who said holders of locked WLFI could not participate.
Onchain voting data indicates that the largest “FOR” votes came from top wallets identified as team-affiliated or strategic partner addresses, according to pseudonymous crypto trader and researcher DeFi^2. The nine largest wallets represented roughly 59% of the total voting power, effectively enabling a small group of large holders to determine the outcome. The single largest wallet accounted for 18.786% of voting power based on the WLFI snapshot.
DeFi^2 stated on X that many real users shown further down the voting list have been unable to access their WLFI since the TGE and therefore could not vote on an unlock until permitted by the team.
USD1 proposal draws contrast with WLFI tokenholder incentives
DeFi^2 questioned why governance was leveraged to expand the protocol via the USD1 initiative instead of prioritizing restrictions affecting a broad base of investors. The researcher noted that WLFI’s Gold Paper specifies that tokenholders are not entitled to any protocol revenue, with 75% of net income allocated to entities linked to the Trump family and the remaining 25% to entities associated with the Witkoff family.
One tokenholder who voted against the measure said it would dilute existing investors without providing clear benefits. The user claimed World Liberty Financial has already deployed more than nine figures of investor capital to build a treasury of assets including Bitcoin (BTC), Ether (ETH) and Chainlink (LINK), while WLFI holders have not received a direct upside from those holdings.
The user added that the company could fund USD1 incentives by liquidating alternative assets rather than further diluting investors. WLFI did not respond to a request for comment by publication time.
World Liberty seeks U.S. banking charter
Earlier this month, World Liberty Financial applied for a U.S. national trust banking charter to consolidate issuance, custody and conversion of its USD1 stablecoin under a single regulated entity. The application would enable the company to mint and redeem USD1 without third-party providers, offer fee-free conversions between U.S. dollars and USD1, and broaden services for institutional clients.
Last week, the firm also introduced World Liberty Markets, an onchain lending and borrowing platform centered on the USD1 stablecoin and the WLFI governance token.
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