World Liberty Financial Is Being Proposed $5 Million Investment by Frax Finance Community

One of the top DeFi projects, Frax Finance, is offering $5 million for investment in World Liberty Financial, with the potential to rise to $10 million based on how the collaboration goes.

The Trump family-linked crypto project, World Liberty Financial, is a DeFi that has just announced the official opening of crypto banking services: deposit, loan, and interest activities. It aims at providing millions of American citizens with access to modern DeFi products.

World Liberty Financial recently invested over $350 million in some of the well-known cryptocurrencies like Ethereum, Wrapped Bitcoin, Chainlink, Aave, Tron, and Ethena. A few of those investments are symbolic, aligning with Donald Trump’s possible presidency as the 47th President of the United States.

But despite its ambition, the proposal has proved controversial within the Frax community. Critics like user Tony239525 say that investing $5 million into a project with a $5 billion fully diluted valuation and few accomplishments could pose financial risks.

Opponents suggest that the focus should be on sustainable initiatives, such as partnerships with established projects or marketing efforts, to ensure long-term growth. There are also concerns about the potential selling pressure on the FXS tokens, Frax’s governance asset, which could negatively affect its value.

This is part of a decision that Frax looks set to leave to a vote, first getting community feedback on their proposal. With more than $559 million of TVL handled, according to DefiLlama, the result could highly affect its roadmap.