Crypto specialists have criticized Donald Trump's new cryptocurrency enterprise World Liberty Financial, which seeks $300 million in crypto token sales.
Crypto specialists have criticized Donald Trump's new cryptocurrency enterprise World Liberty Financial, which seeks $300 million in crypto token sales.
The initiative, promoted by Trump, his three sons Donald Jr., Eric, and Barron, aims to "leverage the global reach and recognition of the Trump brand" to encourage bitcoin adoption, according to its website.
The World Liberty Financial (WLF) website launched on Tuesday, but technical issues plagued it. The company's website failed immediately after launch owing to high traffic.
Sandy Peng, creator of Scroll and WLF advisor, told CoinDesk that 72 million unique visitors in the first hour caused the disruptions.
By Tuesday afternoon, Etherscan statistics revealed that just over 5,000 wallet addresses owned the firm's WLFI coin.
Blockchain and decentralized finance (DeFi) specialists have criticized the company for possible conflicts of interest, unclear investment safeguards, and significant brand harm to an already soiled sector.
"The crypto and DeFi sector has so many undesirables that adding Trump couldn't boost popularity or excitement. Michael Dowling, finance professor at Dublin City University Business School, told Newsweek that crypto exchanges began by enabling drug trafficking.
Dowling warned investors that emerging cryptocurrencies may be risky. "Trump's 'new tech' company investments have often been expensive. He added $10,000 invested in Truth Social shares three years ago is now worth less than $3,000 ".
Potential investors will be painfully reminded of that prior expense. Indeed, his investing record is poor. He shares libertarian ideas with crypto investors, Dowling said.
JD Vance is notably connected with libertarianism in the U.S. IT sector. Thus, bitcoin may be a more natural market for excitement than stocks. The concept that a presidential contender having their own private money (even for DeFi transactions) is very odd."
Nic Carter, general partner of Castle Island Ventures, questioned the project's goals. "He praised crypto but wants to profit. The Financial Times reported that Carter said none of this liberalizes or democratizes finance.
Dowling said most crypto investors want to earn money. "So, while the moral view of Nic Carter might be a valid view, it's unlikely to sway investors," he said.
WLF hired crypto professionals to advise and lead it. Peng and PixelPlex founder and CEO Alex Dulub are among eight industry advisors.
"At PixelPlex, we provided blockchain development and security expertise to World Liberty, advising on best practices and innovative solutions," Dulub said.
To protect the community, Web3 Antivirus actively blocks phishing attempts. We found a bogus WLFI website registered at 11:02 a.m. today. After an 11:17 a.m. tweet, the website was halted and unavailable within an hour "said.
The Verge reported that just 2% of the 20 billion WLFI tokens available for public sale were bought in the first hours, generating $12 million. At 10:30 a.m. Thursday, 856 million tokens (4.32%) had sold.
Dowling called it a "decent launch." "Initial sales normally sell a modest quantity of coins. The goal is that the price rises and most coins can be sold for more. Many coins sold would be a bad indicator "He said.
Trump tweeted on X, previously Twitter, "Today's the day! Live @WorldLibertyFi token sale. Get your $WLFI tokens today." A X user forum post stated: "In the small print, the 'token' is not transferable and locked in the wallet, therefore you cannot withdraw till this'scheme' allows it. Note the details!"
The WLF token grants voting rights but no economic rights. It is also only accessible to registered investors in the U.S.
Dowling told Newsweek that World Liberty resembled earlier crypto, which is expected of a 78-year-old first-time crypto aficionado.
While few currencies before offered economic participation rights, tokens now do so, albeit not universally. For 'investors,' these economic rights are small compared to token price increases. The currency seems to be more speculative than investment, he noted.
WLF may look to be a Republican presidential nominee U-turn. "I am not a fan of Bitcoin and other Cryptocurrencies, which are not money, and whose value is highly volatile and based on thin air," Trump wrote on X in 2019.
"The US has just one genuine currency, which is stronger and more stable than ever. It is the world's most prevalent currency and always will be. The US Dollar!" he said.
In September 2024, the former president used Bitcoin to pay for supper after a rally in New York, claiming, "I just made [my] first transaction in Bitcoin."
"Every crypto guy—crypto maniac—vote. We cannot lose if you vote "Trump added.
At the annual Bitcoin Conference in Nashville, Tennessee, he likened the cryptocurrency sector to the steel industry in its heyday and said the U.S. could become "the crypto capital of the planet and bitcoin superpower of the world."
Dowling said that novice investors may be at danger. "If more Trump supporters join the crypto rush, given their demographics, they may be more vulnerable to frauds and fraud. These marketplaces are complicated, with numerous options that make consumers open to exploitation."
