World Liberty Financial (WLFI), a crypto project backed by the Trump family, has proposed a new staking system which will increase governance participation while it encourages people to use their stablecoin USD1.
The team proposed a requirement for WLFI token holders to stake their tokens for 180 days before they could vote on governance matters in their Wednesday proposal. The system ensures that voting rights stay with users who maintain their involvement over extended periods instead of granting them to users who trade their assets for short times.
Users who stake their tokens would earn an annual return of 2% which requires them to participate in two governance votes during their lock-up period. The system would determine voting power based on two factors: the number of tokens staked and the duration still remaining in the lock-up period.
Incentives tied to USD1 usage
The stakers will obtain extra rewards when they trade on WLFI Markets. The platform allows users to deposit USD1 which enables them to earn rewards from the DeFi protocol Dolomite.
Your completely free resource hub designed to boost your knowledge of cryptocurrencies
The service providers at Nodes which require holders to possess 10 million WLFI tokens will provide users with 1:1 stablecoin conversion of USD Coin and Tether to USD1. Users will have the capability to exchange their assets for traditional currency through an off-ramp.
Holders who possess more than 50 million WLFI tokens function as Super Nodes which enables them to access all available platform features.
At least one billion voting tokens must participate in the proposal which requires majority approval for its passage. Currently more than 27 billion WLFI tokens exist as shown by the data from CoinGecko.
Stablecoin market context
The rollout will begin after the project receives approval for its three planned implementation stages. The first phase will launch staking rewards together with USD1 deposit bonuses. The second phase will allow users to convert their assets at a 1:1 rate while Super Nodes become accessible through partnership agreements and the implementation of a revenue-sharing system.
The stablecoin market proposal presents itself during a period of ongoing market expansion. DefiLlama reports that stablecoin market capitalization has reached a total of over $309 billion.
USDT serves as the top stablecoin in the market which has achieved a market capitalization of over $183 billion while USDC follows in second place with approximately $75 billion. WLFI’s USD1 stands as the fifth largest cryptocurrency with a market value of approximately $4.7 billion.
