World Liberty Financial (WLFI), the Trump-family-affiliated DeFi project, is pitching a new tokenomics maneuver to shore up confidence after its rocky trading debut: a buyback-and-burn program funded by protocol-owned liquidity fees. The proposal comes as WLFI faces sharp market headwinds following its highly publicized trading debut across major exchanges, including Binance, OKX, Upbit, Coinbase, Bithumb, and others. WLFI is trading at around 23 cents, down 24% on-day, with a market cap of about $6.39 billion, according to CoinGecko . At launch, the token briefly commanded valuations of over $40 billion on futures markets before sellers drove the price down. According to a governance proposal released on Tuesday, fees collected from WLFI’s liquidity positions on Ethereum, Binance Smart Chain, and Solana would be used to purchase WLFI on the open market and send it to a burn address. That mechanism would permanently remove tokens from circulation, reducing supply over time. “This program removes tokens from circulation held by participants not committed to WLFI’s long-term growth,” the team wrote, arguing that the design aligns long-term holders with the protocol’s growth trajectory. The measure applies only to fees generated by WLFI’s own liquidity. Third-party or community liquidity providers would not be affected. Alternatives, such as splitting fees between the treasury and burns, were considered but rejected in favor of maximizing impact through 100% allocation to burns. WLFI's Deflationary Narrative For WLFI’s backers, the burn proposal aims to shift the narrative from one of oversupply to one of engineered scarcity. More trading activity would mean more fees, which in turn would result in more WLFI being removed from circulation. At the same time, another governance proposal is making the rounds, this time from the community rather than the team, that would see 80% of WLFI tokens still locked and automatically staked into pools, with rewards drawn from the 20% community reserve. Supporters argue that it would convert idle supply into productive assets and reduce selling pressure, but critics warn that it amounts to redistribution rather than genuine yield generation. The plan is still being debated on the forum and has not gained traction compared with the official burn proposal. Despite the market headwinds and criticism from some token holders on the forum, WLFI’s camp is not without high-profile allies: Tron founder Justin Sun continues to endorse the project on X , calling it “one of the biggest and most important projects in crypto” and pledging not to sell his unlocked tokens. Data from Arkham shows that WLFI's treasury holds $13.78 million in TRX, while Sun holds approximately $693 million of WLFI's token, much of it tied up in vesting arrangements that reinforce his long-term stake in the project. Read more: Bitcoin Long-Term Holders Spend 97K BTC in Largest One-Day Move of 2025
