On April 15, 2026, the World Liberty Financial (WLFI) governance forum released a new proposal for unlocking tokens for early supporters and the team. This proposal aims to address approximately 62.28 billion tokens that are in indefinite lock-up status by introducing a clear vesting schedule and a voluntary team burn mechanism, reshaping the original tokenomics. This is not merely an unlocking event, but a resolution to the governance issues left over from the project's history.

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Understanding this proposal requires clarifying several core tokenomics mechanisms.

First is token vesting, which is a phased unlocking mechanism set in the smart contract by the project team to prevent early holders from immediately selling tokens after they go live. Second is the cliff period, meaning an absolute lock-up time in the early stages of the vesting plan, during which no tokens will be released. Finally, governance overhang occurs when a large amount of circulating out tokens have voting rights, but holders lack incentives to participate in governance due to illiquid tokens, leading to decision inertia and stagnation in community development. In the past, up to 77% of locked tokens in WLFI have never participated in voting, which is a typical example of governance overhang.

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Core of the proposal: Two categories of holders and differentiated unlocking paths

The proposal designs differentiated treatment paths for two categories of holders. Holders must actively choose to opt-in within 10 days; otherwise, the tokens will remain indefinitely locked.

For the team members, including founders, advisors, and partners, the involved amount is approximately 45.23 billion tokens, accounting for 72.6% of the total affected tokens. Selected team members must immediately and irreversibly destroy 10% of the tokens on-chain, with a maximum total destruction amount of 4.52 billion tokens. The remaining 90% of the tokens will enter a 2-year cliff period, followed by linear release over 36 months between the 3rd and 5th years, fully unlocked by the end of the 5th year.

For early supporters, the involved amount is approximately 17.04 billion tokens, accounting for 27.4%. These tokens do not need to be destroyed and are fully retained. There is also a 2-year cliff period, but the linear release period is shorter, with the release completed over 24 months between the 3rd and 4th years, fully unlocked by the end of the 4th year.

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Structural reconstruction's substantial impact on the protocol and market

This proposal has three levels of impact on WLFI's market performance and long-term development.

Predictability in supply-side increase

The unlocking time and conditions for the past 62.2 billion tokens are unclear, creating potential selling pressure concerns in the market. The proposal transforms this uncertainty into an accurate 4 to 5-year release curve. Market and institutional investors can accurately calculate future circulating supply and inflation rates, for example, a fixed monthly release amount for team tokens during the unlocking period, significantly reducing the risk of sudden sell-offs and providing stability in the market.

Substantial deflationary design

Most DeFi projects' token destruction usually comes from unallocated treasury funds, which have little relevance to actual circulation and core interests. The WLFI proposal requires the team to directly destroy their locked share, up to 4.52 billion tokens. This practice directly reduces the total supply and simultaneously lowers the fully diluted valuation (FDV), enhancing the scarcity of the remaining tokens from the supply side.

Strengthening the benefit binding mechanism

In regular project operations, early investors often face stricter unlocking conditions than the team. This proposal reverses that norm, with the team bearing the sole destruction requirement and an unlocking cycle that is one year longer than early supporters. By bearing higher sunk costs and longer liquidity constraints, the team demonstrates its commitment to the long-term operation of the protocol, providing a substantial trust foundation for subsequent application expansions, such as USD1 stablecoin and Aave V3 instances.

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Additionally, there will be a Space on Friday, and everyone is welcome to participate.