World Liberty Financial has published a new governance proposal that would introduce a staking requirement for WLFI token holders and establish a tiered participation structure tied to governance activity.

The proposal, now live on the WLFI forum, asks the community to vote on implementing what the team calls the WLFI Governance Staking System. It stands as one of the most significant governance proposals brought forward in the WLFI ecosystem to date and, if approved, would materially reshape how participation and incentives are structured around the token.

The stated goal is to increase long-term participation in governance while expanding incentives tied to the USD1 ecosystem.

Voting is scheduled to remain open for seven days and requires a quorum of 1 billion eligible WLFI voting tokens.

Staking Would Become Required for Governance

Under the proposal, holders of unlocked WLFI tokens would need to stake their tokens in order to participate in governance voting. Holders of locked tokens would remain eligible to vote without staking.

Key proposed parameters include:

• Minimum lock-up period of 180 days
• Governance power weighted by staking amount and remaining lock duration
• Square root weighting designed to limit concentration of voting power
• Governance rights that adjust dynamically as lock-ups decay

The proposal also introduces a base staking reward targeting approximately 2 percent APR for participants who actively vote. Only stakers who participate in at least two governance votes during the lock period would qualify for rewards.

The WLFI team noted the reward rate would be determined at its discretion and funded from the WLFI treasury.

The proposal also links additional incentives to participation in governance staking.

According to the specification, WLFI incentives on USD1 deposits made through WLFI Markets on Dolomite would be available only to staking participants. Non-staking holders would not receive these deposit incentives.

The motivation section of the proposal states the system is intended in part to redirect value that has recently accrued to market makers during USD1 expansion.