World Liberty Financial (WLF) has published a governance proposal to allocate a portion of its treasury to boost the adoption of its dollar-pegged stablecoin, USD1. The plan suggests using less than 5% of the protocol's unlocked WLFI token reserves, valued at approximately $120 million, to fund structured incentive programs.
The funds are not intended for direct token grants but will be deployed through partnerships with selected centralized finance (CeFi) and decentralized finance (DeFi) platforms. The goal is to support USD1's liquidity, integrations, and usage growth without flooding the market with WLFI tokens. The proposal positions USD1 as a competitor to other regulated stablecoins, explicitly mentioning PayPal's PYUSD, and emphasizes the importance of strategic market placement.
USD1 has seen rapid growth since its launch in March 2025, reaching a Total Value Locked (TVL) of about $2.7 billion within six months. However, it still trails behind competitors like PYUSD, which boasts a market capitalization of $3.86 billion. WLF argues that scaling USD1's circulating supply and real-world usage is essential for strengthening the broader WLFI ecosystem, as increased stablecoin adoption is expected to drive demand for WLFI-governed services and products.
The advisory proposal was submitted to the World Liberty Financial governance forum on December 17, 2025, and is now open for a community vote by WLFI token holders. Initial feedback has been mixed, with some supporting the competitive move and others expressing concerns about treasury management and the precedent of unlocking reserves. In response to governance concerns, WLF has committed to full transparency, pledging to publicly disclose all partnerships and incentive arrangements funded through the treasury allocation.
