The Trump family’s crypto platform, World Liberty Financial, is facing backlash over a new proposal to lock up tokens purchased by early investors for up to four years, or in some cases, indefinitely.
World Liberty posted the proposal to its governance forum on Wednesday, which outlined that early investors would have their World Liberty Financial (WLFI) tokens locked for a further two years before their tokens would be released in batches over the following two years.
According to the proposal, tokenholders who do not accept the new unlock schedule would “continue to have their tokens locked indefinitely.”
The proposal saw wide opposition, with crypto entrepreneur Justin Sun, one of the platform’s advisers and its biggest investor, posting to X on Wednesday that the plan was “one of the most absurd governance scams I have ever seen.”
Sun, who said he holds a 4% stake in World Liberty that is currently frozen, has recently made a series of public criticisms against the platform, taking issue with a separate proposal and accusing it of having controls to blacklist wallets, which World Liberty denied.
Other critics of the proposal included Simon Dedic, the founder of venture firm Moonrock Capital, who posted to X that early WLFI investors “who thought they were sitting on solid profits just got rugged.”
“This essentially gives them another shot at squeezing the same lemon they’ve been inflating with hot air for the past two years. Which, what a surprise, lines up perfectly with the remainder of [Donald Trump’s] term,” he added.
World Liberty Financial did not respond to questions about the backlash, but spokesman David Wachsman told Cointelegraph in an emailed statement that the proposal “was designed to further align all the participants in the WLFI ecosystem for the long run.”
Related: WLFI may drop 20% as World Liberty Financial faces ‘LUNA 2.0’ allegations
Sun’s specific criticisms centered on the plan to indefinitely lock the tokens of those who disagreed with the proposal, accusing the platform of “coercion.”
He also took issue with being “forced out of this voting process” due to World Liberty’s freeze of his tokens and claimed that a “large number of holders with significant voting rights are in the same position.”
Wachsman added that voting on the proposal would begin soon and would run for a week.
The price of the WLFI token has traded flat at 8 cents over the past 24 hours but is down by more than 40% so far this year, alongside a wider retraction in the crypto and share markets.
WLFI has fallen more than 75% since its all-time high of 33 cents on Sept. 1, the token’s first day of public trading after holders voted to allow trading on the originally non-tradable token.
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Cointelegraph by Jesse Coghlan