World Liberty Fi Swaps WBTC for ETH, Focuses on DeFi Flexibility

TLDR

• World Liberty Fi has moved a portion of its WBTC holdings into ETH using decentralized trading protocols.
• The fund executed the swap through Cow Protocol after removing WBTC from an Aave vault.
• The low yield on Aave’s WBTC vault prompted the fund to shift liquidity into ETH-based assets.
• World Liberty Fi now holds over 770 WETH with no current deployment in any DeFi protocol.
• ETH currently offers a higher yield on Aave which influenced the fund’s reallocation decision.

World Liberty Fi restructured its digital asset portfolio by shifting funds from WBTC into ETH, based on recent blockchain data, using decentralized protocols, as the fund moves away from low-yield Bitcoin-based vaults and reinforces its position in Ethereum-linked assets.

ETH Holdings Grow After Swap via Cow Protocol

World Liberty Fi swapped part of its WBTC position into ETH using decentralized trading infrastructure. It removed WBTC from an Aave vault and executed the trade via Cow Protocol, a newly integrated Aave aggregator.

The swap utilized a dedicated address, showing a clear pattern of strategic liquidity management by the fund. This address handled the transition without relying on centralized exchanges, according to wallet tracking data.

The change followed a period of underperformance by Aave’s WBTC vault, which now yields only 0.1% annualized returns. ETH’s higher DeFi utility and return potential prompted the shift as part of a broader liquidity reallocation.

The wallet now holds over 770 WETH, with no protocol affiliation yet for staking or lending. The fund may deploy the asset in future protocols offering favorable returns, as WETH remains flexible in DeFi applications.

ETH traded at $3,255.21 during the operation, compared to 0.035 BTC, supporting the timing of the fund’s position switch. WETH also offers 3.81% yield on Aave after a recent governance vote, making it more attractive for deployment.

WBTC Exposure Reduced as Market Confidence Declines

World Liberty Fi decreased its exposure to WBTC as its role in DeFi protocols continues to decline. The overall supply of WBTC dropped to a low of 124,963 tokens, reflecting lowered demand and support.

Major institutions such as FTX exited WBTC positions earlier, reducing liquidity and institutional confidence in the token. The asset’s limited flexibility in current DeFi operations accelerated its removal from the fund’s strategy.

World Liberty Fi separated BTC-based assets from active DeFi operations, focusing instead on more agile collateral. The swap represents a realignment toward ETH, now the preferred asset for decentralized finance deployments.

WBTC is no longer used as the primary backing for the fund’s DeFi involvement or collateralization strategies. ETH and wrapped variants are now central to the fund’s on-chain exposure, based on available wallet data.

USD1 Activity Expands Across Chains and DEXes

World Liberty Fi continued to support its USD1 token through expanded minting and cross-chain deployments. The total supply reached a record 3.38 billion tokens, fueled by growth across multiple blockchain networks.

USD1 activity on the BNB Chain decreased from 94% to 61%, with more supply moving to Ethereum and Solana. The token now appears on Raydium, enhancing its presence on Solana and reinforcing its cross-chain utility.

The fund added new USD1 trading pairs on Binance, further extending the token’s centralized and decentralized liquidity. These moves support broader ecosystem participation, including in the emerging meme coin space on BNB Chain.

USD1 also started trading on Aster DEX, forming a pair with the B token and enhancing local liquidity. The fund’s wallet recorded new USD1 mints and redemptions, showing active treasury management through token issuance.

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