Fourth Quarter Deterministic Opportunities? In-depth Analysis of WLFI's Long Position Logic and Market Potential

Original Author: hoeem

Original Translation: AididiaoJP, Foresight News

On September 1, World Liberty Financial (WLFI) will launch its governance token WLFI. For some, this is a complete reconstruction of value capture in stablecoins.

For others, it is an almost undisguised Ponzi scheme that will create one of the most intense token bloodsucking markets in recent memory.

I do not agree with the launch of governance tokens and the dynamics of financing, but honestly, this product is great, which is why I choose to go long on WLFI now.

Project Overview

World Liberty Financial is built around USD 1, a stablecoin that claims to be fully backed by cash and short-term government bonds.

The governance layer is the WLFI token. The official documents directly link the Trump family to the project:

Donald J. Trump is listed as an honorary co-founder.
Eric, Donald Jr., and Barron Trump are named as co-founders.
DT Marks DEFI LLC, associated with the family, holds a significant amount of WLFI shares and is entitled to a major share of the protocol's revenue.

This is not just a branding gimmick: the Trump family has direct financial exposure to the protocol.

Why USD 1 is More Than Just Another Stablecoin

Most stablecoins generate revenue through reserves, which typically flow back to the company's balance sheet. For example, Circle's USDC invests billions in government bonds and channels the interest to shareholders.

WLFI disrupts this model. The interest earned from the USD 1 reserves is used to buy and burn WLFI on the open market through smart contracts.

The process is as follows:

Reserves → Protocol Revenue → WLFI Buyback and Burn → Holder Profits.

This means WLFI is designed not only as a governance token but also as a deflationary asset linked to real-world cash flows.

Token Circulation

Date: September 1, 2025
Exchanges: Binance, Bybit, OKX, Gate, etc.
Unlocking: 20% of presale tokens will be tradable at launch, the rest will be locked.
Supply: 5% of circulating supply

The futures market is already trading WLFI, currently priced at $0.26. Once spot trading begins, these presale markets will directly convert to standard perpetual contracts, with price history retained.

Next, I will analyze why this could be one of the most tradable assets in this cycle.

Investment Institutions and Partners

Major players have already entered the scene:

DWF Labs bought in at $0.10.
Aqua One Fund invested $100 million at around $0.125.
Nasdaq-listed ALT 5 Sigma committed $1.5 billion at $0.20 in exchange for 7.5% of the supply.

More notably: ALT 5 has reportedly been approved for $750 million to purchase WLFI.

Do you think they will let it drop below a $20 billion FDV?

Now consider the circulation: only about 5% of the supply will be in circulation at launch. At a $20 billion valuation, that means about $1 billion worth of tradable tokens. With $750 million in reserves, insiders could theoretically absorb almost all of the circulating supply.

This creates a reflexive feedback loop: buying pressure drives up the token price, which in turn makes the locked allocation for insiders more valuable, thereby strengthening the balance sheet used to support the market.

One skeptic bluntly stated: "This is a walking, talking shitcoin with an elite-level Ponzi economic mechanism, sponsored by the president and his family."

Why This Structure is Destined to Skyrocket

Three factors:

Scarcity of Circulation: The circulation is so low that even modest demand can drive significant price volatility.
Built-in Buying Pressure: Every dollar of profit from the stablecoin reserves could translate into systemic WLFI purchases.
Narrative Fuel: This is not just a meme coin relying on Twitter hype. It has political branding, institutional support, and government bond backing.

The value of WLFI held by ALTS does not come from passive price anchoring or merely from on-chain staking yields. Its core value comes from the real-world cash flows generated by its ecosystem's core application, the USD 1 stablecoin.

If Trump's meme coin, with no utility and almost no promotion, could reach a nearly $80 billion FDV valuation, what will happen to WLFI, which has both mechanisms and funding support?

This layout seems designed to create dramatic upward movements.

Risks That Should Not Be Ignored

Long-term FDV is important.

But this is not a long-term bet.

You are betting on low circulation and the president's strong promotion, along with the treasury's desire to raise prices to recoup their 20% unlocked tokens and earn more, as well as their retirement fund on the token unlocking schedule.

Side Bets

There are two smaller projects surrounding the launch of WLFI:

Blockstreet (BLOCK): touted as the launch platform for the cross-chain release of USD 1. Its founder has taken on the role of Chief Information Officer (CIO) at ALT 5 Sigma, directly linking it to WLFI's treasury play.

Dolomite (DOLO): a lending platform whose co-founder is now the Chief Technology Officer (CTO) of WLFI. It may integrate more deeply, such as becoming a DeFi provider for USD 1.

Small market caps mean more room for upside, but also higher risks.

Both are higher beta bets: they may swing more dramatically in either direction based on WLFI's fortunes.

Conclusion

WLFI is many things at once:

A stablecoin model whose buyback revenue is supported by a government-backed governance token.
A political experiment combining DeFi with brand power.
A reflexive financial structure that could reach an outrageous valuation, allowing its investors to extract huge profits in future unlocking schedules (but that doesn't mean you can't make a lot of money at launch).

The layout is undeniable: minimal circulation (5%), massive treasury capital, and a design that continuously generates buy orders by converting real-world earnings into the token itself.

Whether you see it as innovation or a state-sponsored Ponzi scheme, this token launches with only 5% of the circulating supply, and the conditions for a surge are already in place.

After this, the product offered by WLFI is actually very cool; it’s just that the future of the token itself looks bleak because its FDV is overvalued. But remember, market cap at launch is more important than FDV, and FDV matters for the long term, meaning I think they will sell to you over time, but they want as high an FDV as possible to make it happen, especially when ALT 5 enters at $0.20 (a $20 billion FDV), which is not far from the current price. In fact, you could trade at this price on platforms like Hyperliquid in the past 48 hours, making this one of the most tradable assets in this cycle.

My argument is simple.

This will be a liquidity siphon similar to TRUMP, with market conditions turning bearish after TRUMP.

So my plan is to sell at this launch, primarily hold cash in September, and find an entry point before what I believe will be a climax in the fourth quarter.

The same group of people who saw TRUMP launch, reach a $20 billion FDV, and short it when it rose to about $80 billion FDV will do the same this time, except this time WLFI has some utility, lower circulation, and more support.

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