Disinformation Drama Erupts Over Rumored WLFI and Aave Token Deal

World Liberty Financial (WLFI), a DeFi venture associated with US President Donald Trump, has become the focus of a governance dispute. The controversy follows speculation about its potential ties to Aave, the leading decentralized lending protocol.

The discussion escalated when WLFI confirmed its token would be transferable and begin trading in September.

Aave Founder Insists Deal Remains On

Shortly after, crypto users referenced a late-2024 governance proposal. The document suggested that Aave could receive 7% of WLFI’s total token supply, an allocation worth nearly $3 billion at current prices.

The same proposal also mentioned that 20% of protocol revenue generated from WLFI’s planned integration with Aave v3 would flow to the lending platform’s governance.

These claims appeared to have drawn swift attention from the WLFI team.

A representative linked to WLFI told Wu Blockchain that no such arrangement existed, dismissing the reports as inaccurate.

“The WLFI team told WuBlockchain that the claim that ‘Aave will receive 7% of the total WLFI token supply’ is false and fake news,” Wu Blockchain reported.

However, Aave founder Stani Kulechov offered a conflicting view, noting on X that the proposal had already been voted on within Aave’s DAO and that WLFI had signaled agreement.

Meanwhile, the gap between those statements appeared to have unsettled crypto traders.

According to BeInCrypto data, AAVE’s price slid nearly 2% in the hours following the exchange, dropping to $346.15 after volatile swings between $343.63 and $367.73.

AAVE Price Chart. Source: BeInCrypto

Industry experts suggested that the uncertainty surrounding governance decisions was directly influencing market sentiment.

Meanwhile, market observers noted that the episode could significantly impact WLFI’s reputation and the broader industry’s use of decentralized governance agreements.

‘There is a reason why there is so much legalese in finance…If this is true, then expect DeFi [business development] to become a lot more contractualised,” crypto analyst Figue said.

The President Trump-related DFi project now faces questions over whether it can manage expectations ahead of its token launch.

Aave’s All-Time Deposits. Source: Aave

Aave, which recently surpassed $3 trillion in cumulative deposits, remains a cornerstone of the lending sector. The controversy, however, reflects the need for more transparent frameworks in token-based collaborations.