Frax Finance has proposed a $5 million investment in World Liberty Financial (WLFI), a decentralized finance (DeFi) platform with ties to Donald Trump’s administration. The move is part of Frax’s broader strategy to strengthen its foothold in the U.S.-based DeFi sector.
The proposal includes a potential second-phase investment of $10 million, contingent on the success of the partnership. Trump’s election as the 47th President has spurred renewed interest in U.S.-based cryptocurrency initiatives, positioning WLFI as a significant player in the sector.
Frax Finance’s Strategic Expansion into WLFI
Though Trump has not made any direct statements on Bitcoin or cryptocurrencies since taking office, his administration has shown support for blockchain projects with a strong U.S. focus. WLFI, which aligns with Trump’s pro-crypto stance, aims to bring millions of Americans into the DeFi space.
Frax Finance plans to integrate its algorithmic stablecoin, frxUSD, into WLFI’s ecosystem. The initial $5 million investment would secure WLFI tokens, providing Frax with governance influence over the platform. Should the partnership prove successful, Frax could inject an additional $10 million to expand its role within WLFI’s network.
WLFI’s Growing DeFi Portfolio
WLFI holds a diverse portfolio of major DeFi assets, including Ethereum (ETH), Chainlink (LINK), AAVE, and Wrapped Bitcoin (WBTC). Its Ethereum-based assets alone exceed $184 million. The platform’s governance model enables token holders to participate in decision-making, fostering broader adoption of projects like Frax.
Frax Finance’s U.S. roots, coupled with co-founder Stephen Moore’s connections to the Trump administration, further align the company with WLFI’s vision. By integrating frxUSD into the platform, Frax seeks to expand its influence in the DeFi sector while promoting U.S.-driven cryptocurrency adoption.
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