World Liberty Financial Proposes Aave v3 Instance Deployment on Ethereum Mainnet

• WLFI aims to expand DeFi access with Aave v3 on Ethereum, enabling seamless over-collateralized borrowing and lending.
• AaveDAO will gain 20% of WLFI protocol fees and 7% of $WLFI tokens for governance and decentralization support.
• WLFI prioritizes stablecoin liquidity and offers $WLFI tokens as incentives to onboard new DeFi users effectively.

World Liberty Financial has proposed the launch of an Aave v3 instance on Ethereum Mainnet. This initiative aims to enhance access to over-collateralized borrowing and lending, a critical function in decentralized finance (DeFi). 

The proposal, which will integrate Aave’s existing infrastructure, also includes risk management oversight by external managers to ensure robust operations. The move is expected to bring seamless lending and borrowing experiences to new DeFi users.

WLFI Protocol: Expanding DeFi Accessibility

The proposed World Liberty Financial (WLFI) Protocol plans to facilitate liquidity for Ethereum, Wrapped Bitcoin (WBTC), and stablecoins such as USDC and USDT. Initially, these assets will be available for both borrowing and lending, with potential expansions determined by future governance proposals. The WLFI Protocol aims to onboard first-time DeFi users by offering straightforward access to digital asset-backed borrowing and lending.

To enhance accessibility, the WLFI Protocol will mirror Aave’s reserve factor system while dynamically adjusting supply caps for assets like ETH and WBTC. Stablecoin liquidity will be prioritized to ensure borrowing remains viable. Users participating in the protocol will also receive $WLFI tokens, adding an incentive layer to the platform. This token distribution will comply with applicable legal frameworks.

Revenue Sharing and Governance Integration

The proposal outlines a revenue-sharing model to benefit both AaveDAO and WLFI Protocol participants. AaveDAO will receive 20% of the protocol fees generated from the WLFI Aave v3 instance. Additionally, approximately 7% of the circulating supply of $WLFI tokens will be allocated to AaveDAO for governance participation, liquidity mining, and decentralization efforts.

A trustless smart contract will govern the revenue split between the AaveDAO and WLFI treasuries. The governance process will ensure transparency in fee allocations, enhancing trust among users. WLFI’s inclusion of Aave risk managers adds another layer of security, aiming to balance stablecoin liquidity with asset supply caps effectively.

Strengthening Aave’s Market Position

The WLFI proposal emphasizes introducing new users to DeFi while solidifying Aave’s position in the borrowing and lending space. By deploying the Aave v3 instance, WLFI aims to promote a broader user base for both protocols. This partnership seeks to enhance brand recognition while expanding DeFi adoption through a user-centric approach.