Crypto Clash: WLFI Plunges as 'Coercive' Vesting Proposal Goes Live

World Liberty Financial's native token, WLFI, experienced a sharp decline of approximately 17% this Wednesday following the launch of a highly contentious governance proposal. The proposal, which impacts over 62 billion WLFI tokens, has triggered immediate backlash within the crypto community, raising questions about investor freedom and project integrity.

The Vesting Shockwave

Currently trading around $0.06, WLFI's value reflects a staggering 70% drop since its initial market debut. This latest selloff is attributed to a governance proposal designed to implement stringent vesting schedules for tokens held by early investors and insiders in the Trump-family-linked DeFI project. Under the new plan, these token holders face a two-year lockup period, followed by an additional two years of gradual release. Founders, team members, and advisors are subject to a similar two-year cliff, though their tokens would then vest linearly over three years. Voting on this pivotal proposal is set to conclude on May 7.

A Controversial Mandate and Fierce Opposition

While initial voting figures show overwhelming support, with 99.95% of cast votes in favor and 6 billion tokens backing the proposal against just 3.2 million, the underlying mechanics have drawn heavy criticism. The voting structure is widely perceived as coercive, as participants who do not cast a vote risk having their tokens locked indefinitely. Prominent figures like Moonrock Capital founder Simon Dedic vehemently likened the proposal to a "rug pull," questioning its timing, which notably aligns the two-year unlock period with a potential return to office for Donald Trump. Tron founder Justin Sun also weighed in, calling it "one of the most absurd" proposals he had encountered. Despite the outcry, World Liberty Financial defends the initiative, stating it aims to foster a clearer governance structure and ensure tokens remain with genuinely committed, long-term project participants.