Trump-backed World Liberty Financial DeFi venture deepens Aave activity with $7.5 million loan

The Trump Family backed the DeFi project, and World Liberty Financial (WLF) picked lending protocol Aave to execute its DeFi transactions. The project recently borrowed $7.5 million in USDT from the Aave V3 platform.

According to X account Onchain Lens, citing data from Nansen, the project deposited $52 million worth of Ether, wrapped Bitcoin, and Lido Staked Ether on the protocol before taking the loan.

While it is unclear what the project plans to do with the borrowed funds, it has already moved it to a Bitgo wallet, leading to speculations that it is depositing the funds to withdraw USD1. USD1 is the stablecoin issued by WLF, and Bitgo is the custodian of the stablecoin.

Meanwhile, the recent transactions mark WLF’s biggest DeFi move since it launched last year. While it previously deposited around 5 million USDC on Aave, it has mostly focused on buying tokens, including Ether, Bitcoin, and several altcoins, for its treasury .

Nevertheless, WLF’s decision to use the Aave protocol is unsurprising, given that the project deployed an instance of Aave v3 as its DeFi platform in 2024. It has also acquired AAVE tokens for its treasury.

Interestingly, WLF is not the only crypto project using Aave for DeFi transactions. A few weeks ago, the Ethereum Foundation borrowed $2 million worth of GHO stablecoins on Aave while depositing ETH to the platform.

Aave TVL now above $40 billion (Source: Token Terminal)

The increased activity on Aave has translated into milestones for the protocol in the past few days. It recently reached a new all-time high in total value locked (TVL) with $40 billion, while total borrows also reached a new peak above $16 billion.

WLFI USD1 supplies $2 billion in market cap, but growth slowed

Meanwhile, the recent transactions by WLF appear to be part of its efforts to boost the adoption of its USD1 stablecoin. The stablecoin, launched only a few weeks ago, is already one of the fastest-growing circulating supplies at around $2.18 billion, according to Defillama .

The massive volume growth is due mostly to a $2 billion investment by sovereign wealth fund MGX into Binance, which was conducted using USD1.  Beyond that massive surge, supply has grown much slower, with less than a $60 million increase over the last 30 days.

However, the project has also been making efforts to boost adoption through various means, including the decision to airdrop around $4 million USD1 to holders of WLFI tokens. This is part of its broader one-month campaign to boost the adoption of the BNB Smart Chain.

So far, BSC’s DeFi protocols, such as DWF Liquid Markets, Pancake Swap, ListaDAO, Venus Protocol, and Aster DEX, have all integrated the stablecoin into their platform, while exchanges such as MEXC are also offering 100% APR to stake USD1.

Trump’s family involvement driving WLF performance

Beyond its USD1 moves, WLF has also announced plans to acquire TRUMP memecoin for its treasury. The Trump Organization executive vice president, Eric Trump, announced the move, which WLF confirmed.

Interestingly, the project is also planning to launch a wallet. Donald Trump Jr. disclosed this while debunking recent claims of a Trump crypto wallet by Magic Eden. According to Trump Jr., the Trump Organization does not authorize the wallet to be promoted by Magic Eden because WLF is working on an official wallet.

With WLF dabbling in many crypto products and seeing sizable traction, many believe its success is only due to its affiliation with President Trump. Although Trump and his family are not directly involved in the operation of WLF, their influence as ambassadors appears to be the driving force behind it.

Unsurprisingly, this has meant increased criticisms of the family crypto affiliations by political opponents and even some members of the crypto community who believe the president’s pro-crypto moves have significantly benefited his private interests.

Cryptopolitan Academy: Tired of market swings? Learn how DeFi can help you build steady passive income. Register Now