World Liberty Financial has posted a governance proposal to restructure the unlock terms for 62.28 billion locked WLFI tokens, introducing multiyear vesting schedules and an opt-in burn mechanism for founder, team, adviser, and partner allocations. The proposal, shared by World Liberty Financial on X, marks the project’s most formal response yet to mounting pressure from early token buyers who have faced prolonged lockups with no clear path to liquidity.
Under the terms outlined in the proposal, early supporters holding locked tokens would face a two-year cliff followed by a two-year linear vesting period. Founder, team, adviser, and partner allocations would carry a two-year cliff and a three-year linear vest for those who opt in to the revised terms.
Holders who decline the new conditions would remain locked indefinitely, effectively forcing a choice between structured liquidity and an open-ended freeze.
Burn Mechanism Adds a New Layer to Supply Management
The proposal introduces a potential burn of up to 4.52 billion WLFI tokens, representing 10% of the total founder, team, adviser, and partner allocation.
This mechanism is opt-in, meaning it applies only to holders who agree to the new vesting terms, and it is designed to reduce circulating supply pressure over the medium term.
The burn provision adds a deflationary element that the project had not previously formalized, giving holders a concrete trade-off to evaluate before committing to the new schedule.
The structured release avoids a near-term surge in token supply, which would have been a significant concern given WLFI’s recent price performance.
The token fell to a new all-time low over the weekend, just days after wallets linked to the project used billions of tokens as collateral to borrow approximately 75 million dollars in stablecoins. That sequence rattled confidence among holders already frustrated by limited access to their positions.
The timing of the proposal is directly tied to legal pressure. On April 10, the project acknowledged it would introduce the governance vote after a group of early buyers threatened legal action over what they described as unreasonable and opaque lockup conditions.
The proposal formalizes a phased unlock approach that World Liberty Financial had previously signaled without committing to specific timelines, giving it the structure needed to defuse the immediate legal threat while avoiding a flood of newly liquid tokens hitting the market.
Justin Sun's Allegations Deepen Governance Scrutiny
The unlock proposal arrives in the middle of a public dispute with Tron founder Justin Sun, who previously invested 30 million dollars in WLFI.
Sun publicly criticized the platform earlier this week, alleging that prior governance votes were dominated by a small number of wallets and lacked meaningful participation from the broader token holder base.
His comments raised questions about whether WLFI’s governance structure allows genuine decentralized decision-making or concentrates control in a small set of insiders.
Sun also urged the project to publicly disclose who controls the key wallets tied to its smart contracts, warning that the current setup could grant certain parties the ability to freeze tokens held by others.
That allegation, if substantiated, would represent a serious structural concern for any project claiming to operate as a decentralized finance platform. World Liberty Financial responded by threatening to file a lawsuit against Sun, escalating what had begun as a transparency dispute into a direct legal confrontation.
The combination of holder lawsuits, public allegations from a major investor, and a token price at record lows creates a challenging backdrop for the governance vote. The proposal must now win support from a community that has grown visibly skeptical of the project’s transparency and decision-making process.
Whether the structured vesting terms and optional burn are enough to restore confidence will depend largely on turnout and the distribution of voting power among existing holders, the very dynamic Sun called into question.
World Liberty Financial’s governance challenges are unfolding as Trump-linked crypto projects more broadly face renewed scrutiny over their market performance and operational practices.
WLFI’s treasury activity, including the large stablecoin borrowing position secured against project tokens, has drawn attention to how the platform manages its own financial exposure while asking token holders to accept years-long lockups.
For early supporters, the proposal at least provides a formal exit ramp, even if the timeline runs well into 2028 for those subject to the longest vesting schedules.
Not Financial Advice: This article is for informational purposes only. Crypto investments are highly volatile. Always do your own research.