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Journalist
Hassan Shittu
Journalist
Hassan Shittu
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World Liberty Financial, a decentralized finance (DeFi) platform backed by President-elect Donald Trump, will collaborate with Ethena Labs to enhance its ecosystem.
The two companies announced plans for a “long-term collaboration,” beginning with the potential implementation of Ethena’s yield-bearing token, sUSDe, as a collateral asset in WLFI’s forthcoming instance of the Aave protocol.
sUSDe Integration Proposal: How Ethena and World Liberty Financial Aim to Expand Stablecoin Utilization
A governance proposal has been submitted to facilitate this integration. If approved, WLFI users can access sUSDe rewards and WLF token rewards.
According to the proposal, the initiative is expected to boost stablecoin liquidity and utilization of the protocol, replicating sUSDe’s success in Aave’s Core and Lido instances.
In a joint statement, the companies emphasized the initiative’s potential impact, explaining that integrating sUSDe could boost stablecoin deposits within WLFI’s Aave instance.
Since its onboarding to Aave in November, sUSDe has experienced rapid growth, reaching approximately $1.2 billion in supplied assets within a month.
The team said in the statement:
“In the unlikely event that WLFI governance does not approve the Aave instance or the use of sUSDe as collateral, both firms remain committed to exploring other avenues for collaboration.”
Its integration has significantly increased stablecoin deposits and supply rates for assets like USDC, USDT, and USDS. World Liberty Financial’s (WLFI) governance body is expected to vote on the measure this week.
If approved, sUSDe would be integrated into WLFI’s forthcoming instance of the Aave protocol, enabling it to access Ethena’s significant total value locked (TVL) and established user base.
It will also allow WLFI to benefit from Ethena’s user base and the increased utilization of stablecoin deposits. The Ethena Foundation has committed to co-incentivizing deposits of sUSDe with additional rewards.
Additionally, WLFI users would receive WLF token rewards for sUSDe deposits.
The proposal also includes pre-approving sUSDe’s eligibility for E-Mode and aligning it with risk configurations set by Aave’s risk managers.
Trump’s Crypto Pivot: World Liberty Financial Shakes Up DeFi
World Liberty Financial represents Donald Trump’s most significant venture into cryptocurrency, an industry he previously criticized.
Since his election in November, Trump has become more crypto-friendly and signaled his intent to reduce regulation in the digital assets sector.
WLFI launched in September and seeks to democratize access to decentralized finance (DeFi). In October, it began its public token sale, signaling its intent to grow within the DeFi ecosystem.
The announcement follows a series of strategic moves by WLFI. At the end of November, the platform appointed Justin Sun, the founder of Tron, as an advisor. This was soon followed by a $30 million investment in WLFI from HTX, a crypto exchange linked to Sun.
WLFI has also expanded its digital asset portfolio significantly.
Since Nov. 30, its wallet has acquired $30 million in Ether (ETH), $10 million in Coinbase Wrapped BTC (cbBTC), $2 million each in Chainlink (LINK) and Aave (AAVE), and smaller purchases of Ethena (ENA) and Ondo (ONDO), totaling $44.75 million in token buys this month.
On Dec. 13, AaveDAO approved WLFI’s proposal to deploy its own Aave instance, enabling borrowing and lending for assets like ETH, WBTC, and USDC while sharing protocol fees and token supply with the DAO.
