With crypto continuing to remain a front-and-center issue in U.S. political circles, including the nomination of a pro-crypto challenger to Senator Elizabeth Warren, it should come as no surprise that policymakers are wading more directly into the sector. Specifically, former President and current candidate Donald Trump has been making public and forceful forays into the crypto sector, seemingly a reflection of the massive spending that the crypto industry has invested into current races. The latest example of this is the coming launch of World Liberty Financial, a crypto project founded, supported, and endorsed by the presidential candidate.

While specifics remain somewhat difficult to pin down, with some versions of the whitepaper becoming available, there is still plenty to digest as the project comes to light. As with most things involving former President Trump, however, there has been some controversy and drama around the launch of the project. Specifically, the X account of Laura Trump, daughter-in-law of the former President and Republican National Committee co-chair, appeared to be hacked, disseminating false information regarding the launch and malicious links to a coin falsely claiming to be the official coin of the project.

Setting aside these hiccups and drama, it is indicative of the strength in the crypto sector that a presidential candidate from a major U.S. political party is launching a project in the middle of a campaign. Let’s take a look at items crypto investors should keep in mind as the project continues to move forward to launch.

Security Should Be A Top Concern Any project led by such a high-profile figure, such as the former President, is bound to attract substantial attention from investors, policymakers, and criminal actors looking to exploit weaknesses in the infrastructure and cybersecurity. Analysis of the components and versions of the whitepaper leaked to date indicate that the technical underpinnings of World Liberty Financial are very similar to those that supported Dough Finance. In July 2024, Dough Finance was hacked via flash loan transactions focusing on vulnerable smart contracts. The founding team, including Trump family members and the technical team, have emphasized that security will be forefront for this venture, but the technical similarities warrant further examination. Additionally, the continuous leaks of details and pieces of information leave the project vulnerable to hacking and impersonation scams already occurring.

Centralization Will Be Front And Center Mirroring many of the crypto products and services deployed since 2022, a defining characteristic of World Liberty Financial, according to the whitepaper, is that 70% of WLFI – the governance token – will be held by the founders, team, and service providers. Centralization and this level of concentrated control oppose the original ideas behind the crypto movement but align with the centralization seen in staking, stablecoin, and ETF slices of the crypto landscape. For context, Ethereum’s Genesis block reserves a combined 16.6% of ether for the Ethereum Foundation and early contributors, Cardano founders retained 20% of ADA, and Satoshi Nakamoto holds approximately 5% of the total bitcoin supply. While the final whitepaper and tokenomics are yet to be disclosed, the level of centralization of governance tokens is worth noting for investors looking to both invest and exercise voting power through acquisition of WLFI tokens.

Stablecoins Feature Prominently Since the final tokenomics and whitepaper have yet to be publicly disclosed, the mission and business model of World Liberty Financial remain speculative versus fact. That said, both former President Trump and project representatives have reiterated the goal of establishing the U.S. as the crypto capital of the planet. One publicly disclosed avenue is the aspiration to embrace stablecoins alongside the WLFI governance token. Building on comments from Trump regarding the U.S. as an economic leader and crypto hub, combined with the fact that over 90% of stablecoins are backed on a 1:1 basis by the dollar, these statements seem aligned. Specifics regarding which stablecoins will be integrated are forthcoming, but it indicates the growing importance of stablecoins to the crypto space. Regardless of how World Liberty Financial works out, this project will continue to elevate crypto in mainstream coverage and investor understanding.