Original | Odaily Planet Daily ( @OdailyChina )

By Golem ( @web3_golem )

WLFI is really coming. On August 23rd, World Liberty Financial (WLFI), the Trump family's crypto project, announced that it would open its initial WLFI token redemption and trading on September 1st. Early supporters (in the $0.015 and $0.05 rounds) will only unlock 20% of the tokens, with the remaining 80% unlocked by the community through a governance vote. Tokens held by the founding team, advisors, and partners will not be unlocked at launch.

Following the announcement of the token's launch date and unlocking schedule, exchanges such as Binance, OKX, and Hyperliquid also announced the launch of pre-market trading for WLFI/USDT perpetual contracts, pre-pricing WLFI. According to Binance data, WLFI reached a high of $0.55 before declining, currently hovering around $0.22. WLFI's fully diluted valuation remains at $22 billion.

Even though WLFI's pre-market price has halved from its peak, participants in the first and second rounds of the public offering have already realized over 14 times their expected returns. With only one week left until WLFI's official launch, what will the price trend be like after the market opens? Odaily Planet Daily will analyze this in this article for your reference.

Scenario 1: All participants hedged, and the opening price plummeted

Many people have directly felt that WLFI is too expensive. The pre-market price of WLFI on Binance soared to $0.55, giving WLFI a fully diluted valuation of $55 billion. This valuation has surpassed TRX and DOGE, and directly ranked WLFI as the 8th largest cryptocurrency by market capitalization. Even with the current price falling back to around $0.22, the fully diluted valuation of $22 billion surpasses a number of recently popular tokens like LINK and HYPE.

If the current price is maintained upon launch, early investors (participants in the first and second rounds of the public offering) will realize returns exceeding 14 times. Even if only 20% is unlocked, this is already a substantial return. It is highly likely that WLFI will be "poured" into the market after launch. Based on this analysis, facing the selling pressure from early investors, it is highly unlikely that major funds will actively take over the selling pressure upon WLFI's launch. WLFI will likely "plummet" in the first wave of launch.

Moreover, the fermentation period of WLFI from its birth last year to its upcoming launch is too long, and the temporary benefits have basically been exhausted. The market may have fully priced WLFI in the pre-market contract. The cost for ordinary investors who did not participate in the public offering will be much greater than that of early investors, and they will not be willing to take over the initially unlocked tokens.

Therefore, many participants in the public offering will choose to hedge through WLFI contracts to secure some profits in advance. According to Coinglass data, as of now, the total WLFI contract holdings on the entire network have reached 1.272 billion, valued at approximately US$279 million. Among them, Binance WLFI contracts hold 698 million WLFI contracts, accounting for 53.77% of the total network, valued at US$150 million.

Many investors also believe that while the WLFI team and institutions haven't unlocked their tokens, they may have profited through pre-market hedging. This is because, compared to retail investors, project owners and institutions with large volumes and a higher tolerance for error are more capable of hedging through contracts. This isn't groundless speculation about the Trump family; it's no secret that they use the crypto industry as a cash-out destination. A previous Financial Times analysis suggested that Trump has profited at least $350 million from TRUMP, including both token sale proceeds and market-making fees.

According to public data, the Trump family has earned $57.35 million from WLFI tokens through token sales alone. If the team and partners don't initially unlock their tokens, they could potentially profit from pre-market hedging. This also means that after WLFI launches, the team and its market makers may not actively drive up its price for a period of time.

Scenario 2: WLFI will replicate Trump's initial launch scenario

However, some believe that pre-market contract prices are merely a reflection of market sentiment and market maker manipulation, unrelated to the project itself. Due to the pre-market overheating, market makers liquidated long positions. Similarly, WLFI could also experience a significant price increase due to a short squeeze in the day or two before its launch. According to Coinglass data, WLFI contracts are currently experiencing a surge in long positions, with $2.1636 million in long positions and $1.045 million in short positions liquidated on Binance in the 24-hour period.

Furthermore, as both are funded by the Trump family, WLFI may follow a similar path to TRUMP upon launch. While WLFI's current fully diluted valuation has reached tens of billions of dollars, its actual circulating market capitalization is relatively low. WLFI sold a total of 25 billion tokens in its first and second public offerings, but only 5 billion remain in circulation in this initial offering. The unlocking schedule for the remaining public offering tokens is subject to community vote, and tokens held by the founding team, advisors, and partners will not be unlocked upon launch. This means that, based on the current price of $0.22, WLFI's circulating market capitalization upon launch will be $1.1 billion, a significant undervaluation for a project of its size.

In fact, this is similar to the initial scenario of TRUMP’s launch. The total amount of TRUMP is 1 billion, and its circulation volume at the initial launch is 200 million. This resulted in even though TRUMP’s market value quickly passed 10 billion US dollars on the same day, when players realized TRUMP’s token structure, the market still believed that the token endorsed by President Trump was undervalued.

WLFI also has Trump's endorsement, and on the day of its official launch, there's a high probability that Trump will congratulate WLFI on social media or make various "calls" for WLFI. His ambiguous relationship with the president will also create more hype for WLFI. Therefore, the price of WLFI will likely continue to rise when it goes online.

Even if TRUMP's release drained market liquidity, and the market recognized the Trump family's true colors and disenchanted celebrity coins, we can still assume that the Trump family is well aware that "pulling the price is the best marketing." Furthermore, WLFI isn't just a meme coin; it also operates the USD1 stablecoin. Only by driving up WLFI's price can crypto financial flows be transformed into substantial ecological drivers.

Related Reading

WLFI is nearing trading launch: Understanding the ecosystem and valuation structure in one article

WLFI Unlock Countdown: Trump's 15.75% Whale Holdings, Can the Market Withstand the "Presidential Selling Pressure"?