Last week, World Liberty Financial (WLFI) holders overwhelmingly voted to unlock the token. Projects related to the Trump Family have specified that tokens will be traded in six to eight weeks. This move will allow these governance tokens to be able to trade peer-to-peer transactions and in secondary markets.
Erwin Voloder, head of policy at the European Blockchain Association, explained that the move will allow for wider participation, but capital concentration could undermine decentralization. This is especially worrying as the Trump family controls 40% of their total supply. Key players like Justin San and the Aqua 1 Foundation have already invested millions in tokens.
WLFI is open for trading
This week, WLFI owners overwhelmingly voted to unlock the token. Previously, these tokens only allowed voting rights, but now they are sold to hold them by anyone.
Trades are permitted, but unlocking occurs in stages. Only a portion of tokens originally sold to early supporters will be eligible for trading.
The rest, including those held by the founders, advisors and the team behind WLFI, will be eligible for a second vote to determine unlock and release schedules.
Tradeability allows the platform to achieve a market-driven distribution of price discovery and governance power. This move will lead to increased liquidity within the platform and higher levels of user engagement.
“This will allow for wider participation as it lowers the entry barriers for new token holders and investors who want governance statements. The other side has tradable tokens that portray investors’ interests and capital.
Unlocking a token lowers the barrier to entry for new token holders, but raises the question of who will buy it and what intent it is to buy it.
Trump Factor of WLFI Governance
The terms WLFI and Trump have become inseparable, at least among cryptography enthusiasts. This connection is not surprising.
President Trump personally owns 15.75 billion governance tokens, but his family’s affiliated entities reportedly fell from the first 75% in December 2024.
Even if WLFI tokens become tradeable, the Trump family maintains considerable control over governance decisions through substantial token holdings. This direct impact remains in place until the second stage of the unlock schedule. However, the indirect impact that the President applies to the project would be difficult to rule out.
“In the crypto market, the ideal of decentralization often clashes with the reality of capital concentration and brand-driven influence. WLFI is not unique in that regard when you look at supply, distribution and influence, but unique in the sense that the project is on the trajectory of the US president, where the project is sitting,” says Voloder.
Beyond direct ownership, the relationship between WLFI and the Trump family is also a major draw for investors.
Does the token unlock the Whale Victory?
Unlocking WLFI tokens promotes wider participation, but ironically exposes centralization. Most notably, it attracts accumulation and institutional influence from whales.
In addition to the concentration of power from the existing Trump family, wealthy investors have already expressed interest in tokens.
In January, Justinsan increased its $30 million initial investment in the token to $75 million. In April, Abu Dhabi-based Crypto Trading Firm DWF Labs announced that it had purchased $25 million worth of tokens.
Last month, the United Arab Emirates-based Aqua 1 Foundation announced the purchase of tokens worth $100 million. The foundation has already undergone scrutiny of its origins and opaque nature, reinforcing concerns about owners’ intentions regarding token governance.
According to Voloder, trading ability can easily lead to a concentration of governance power of wealthy actors who accumulate tokens in the secondary market.
“A common phenomenon that can be observed in the crypto market is how this concentration often leads to plutocracy, where “one token-one vote” decisions are determined by the wealth of tokens rather than egalitarian participation.
Now that WLFI tokens are officially available for trading, wealthier investors will probably jump at the opportunity.
The road to egalitarian governance
No one has publicly declared their intention to purchase WLFI tokens since their recent unlock, but these governance tokens will likely continue to attract these investors.
“Given existing interests from high-net-held individuals and organizations, it is likely that further integration among large investors, at least in the short term. The Trump family’s maintained voting rights and indirect impact could also block participation in retail governance,” Voloder said.
To create a fairer system of token unlocking in the current context, the very entity must take the problem to their own hands. Unless WLFI implements governance mechanisms such as secondary voting and limiting to per-wallet token holding, whales will continue to gain disproportionate impacts.
However, certain solutions have begun to emerge that the broader Web3 community can take to truly democratize decentralized governance.
Strategies such as anti-civil mechanisms, more progressive voting schemes, reputation-based models, and the Community Treasury have emerged as valuable alternatives.
“The reality is that these efforts take time, and in short term terms, the economics and incentives of stories that accumulate wealth at the expense of others are still registered by many actors. It’s important to resist plutocracy, especially when celebrities and geopolitical capitals play a central role.”
To tackle a better future in any scenario, we need to understand today’s mechanisms that offset systems originally designed as egalitarian.
Paradox of openness and power
WLFI’s recent token unlock represents the decisive dilemma of the Web3 era. This is a promise of open participation in the gravity gravitational force of concentrated wealth.
This project serves as a key test case as the market begins to determine the value of WLFI and distribute governance power. The trajectory reveals whether decentralized ideals can thrive within the vital support of celebrities and substantial institutional capital flows.
Future phases will ultimately reveal whether WLFI can transcend traditional power structures or simply reflect the plutocratic trends the broader Web3 community is striving to overcome.
Disclaimer
Following Trust Project guidelines, this feature article presents the opinions and perspectives of industry experts or individuals. Although Beincrypto is dedicated to transparent reporting, the views expressed in this article do not necessarily reflect the views of Beincrypto or its staff. Readers should independently verify the information and consult with experts before making decisions based on this content. Please note that our terms and conditions, privacy policy and disclaimer have been updated.
