World Liberty Financial plans token buyback after more than 60 percent year-to-date slide
The crypto venture, backed by Donald Trump, may use fees from its USD1 stablecoin reserves to fund the token repurchases, aiming to boost governance participation.
Key takeaways
- 1World Liberty Financial announced a buyback program for its WLFI governance token on Thursday.
- 2The WLFI token has fallen by more than 60 percent this year.
- 3The company may use fees from its USD1 stablecoin reserves to fund token purchases.
- 4The buyback aims to boost protocol governance participation and increase long-term investor voting power.
- 5WLFI fell about 10 percent since the US midterm elections this week.
World Liberty Financial announced a buyback program for its WLFI governance token on Thursday, CoinGape reported. The move follows a significant decline in the token's value, which has fallen by more than 60 percent this year.
The company said the program would begin with an initial allocation. CoinDesk reported that the crypto venture may use fees from its USD1 stablecoin reserves to fund the token purchases. Other sources could also contribute, CoinGape said. World Liberty stated the buyback aims to encourage greater participation in protocol governance and give long-term investors increased voting power. The company suggested that token repurchases could become a regular part of its strategy.
The WLFI token has faced selling pressure, particularly after the US midterm elections this week, CoinGape said. Republicans performed worse than expected in the vote. The token fell about 10 percent since the election and is now down more than 60 percent this year.
The decline brings renewed focus on the Trump family’s financial stake in World Liberty Financial. Trump reportedly holds billions of WLFI tokens, leaving the value of those holdings exposed to the token’s price performance, CoinGape reported.
Democrats' victories in the November 3 midterm elections have shifted control of Congress, putting them in a stronger position to investigate the Trump family’s business interests. World Liberty Financial could be an early target, CoinGape said. Representative Robert Garcia, expected to lead the House Oversight Committee, has indicated plans to examine Trump's crypto dealings. Senator Elizabeth Warren, expected to chair the Senate Banking Committee, previously called for hearings into a reported $500 million investment by an Emirati royal in World Liberty, citing potential conflicts of interest.
WLFI holders are also watching a gala dinner scheduled for November 22. This event is expected to bring together Trump and the token’s top 185 holders, according to CoinGape.
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