TRUMP

Arkham

World Liberty Financial

World Liberty Financial's WLFI token dropped approximately 12.9% at one point in the last 24 hours.
This comes after reports emerged that the Trump family-backed crypto project had been using its own governance token as collateral to borrow stablecoins. In doing so, it had drained a lending pool to the point where other depositors could not withdraw their funds.
According to <a href="https://www.coindesk.com/markets/2026/04/09/trump-s-world-liberty-financial-borrows-usd75-million-against-its-own-token-trapping-depositors-on-dolomite" rel="noopener noreferrer nofollow">CoinDesk</a>, WLFI pledged 5 billion of its own WLFI tokens on the Dolomite lending platform to borrow $75 million in stablecoins, effectively emptying the protocol's USD1 pool.&nbsp;
More than $40 million of those borrowed funds were then sent to Coinbase Prime. The report landed in an already fragile crypto market, and the reaction was swift.
<blockquote class="twitter-tweet">
 UPDATE: WLFI drops 14.7%, extending losses as concerns around leverage and liquidation risks continue to weigh on sentiment. <a href="https://twitter.com/search?q=%24WLFI&amp;src=ctag&amp;ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">$WLFI</a><a href="https://twitter.com/hashtag/Trump?src=hash&amp;ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">#Trump</a><a href="https://twitter.com/hashtag/Stocks?src=hash&amp;ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">#Stocks</a><a href="https://t.co/4D3xXOZO1m" rel="noopener noreferrer nofollow">pic.twitter.com/4D3xXOZO1m</a>— Roundtable Network (@RTB_io) <a href="https://twitter.com/RTB_io/status/2042674741333590243?ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">April 10, 2026</a>
</blockquote>
Adding fuel to the fire, insiders revealed that the team had quietly scrapped a proposal to unlock $427 million worth of tokens, a move that was expected by early investors and whose sudden cancellation accelerated the selloff and deepened the sense of unease around the project.
<a href="https://www.thestreet.com/crypto/markets/wlfi-nearly-doubled-xrps-derivatives-volume-before-crashing-28" rel="noopener noreferrer nofollow">Related: Trump family’s WLFI token briefly overtakes XRP derivatives volume before 28% crash</a>
<h2 id="wlfi-fires-back">WLFI fires back</h2>
The project did not stay quiet. In a lengthy <a href="https://x.com/worldlibertyfi/status/2042366926244974901?s=20" rel="noopener noreferrer nofollow">thread </a>on X, World Liberty Financial pushed back hard against what it called FUD, which stands for fear, uncertainty, and doubt in crypto, dismissing the concerns as a misreading of how its lending strategy works.
<blockquote>
 "We are one of the largest suppliers and borrowers on WLFI Markets. Yes, we supplied WLFI as collateral and borrowed stablecoins. No, we are nowhere near liquidation — and frankly, even if markets moved dramatically against us, we'd simply supply more collateral. That's not a risk. That's how this works."
</blockquote>
The project also framed its borrowing activity as a feature rather than a flaw, arguing that by acting as the anchor borrower, it was generating the yield that makes its lending platform attractive to everyday users.&nbsp;
It cited a $159.5 million annual revenue run rate for USD1 and disclosed that over the past six months, it had <a href="https://etherscan.io/address/0x284cF133aa570F29DA0961BE897dbBb2a37962f8" rel="noopener noreferrer nofollow">bought back </a>435 million WLFI tokens at an average price of $0.15, totaling $65.58 million in open market purchases.
<h3 id="popular-on-thestreet-roundtable">Popular on TheStreet Roundtable:</h3>
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</ul>
<h2 id="billionaire-sees-11m-evaporate">Billionaire sees $11M evaporate</h2>
Meanwhile, billionaire Justin Sun, founder of the Tron blockchain, watched more than $11 million evaporate from his frozen WLFI holdings on Friday as the Trump-backed project brushed off concerns about its borrowing strategy.
Sun had put $30 million into World Liberty Financial in late 2024, before WLFI began trading. He later built his position to roughly $75 million in WLFI tokens and separately committed $100 million to Donald Trump's TRUMP memecoin.&nbsp;
The relationship soured when World Liberty <a href="https://www.thestreet.com/crypto/markets/justin-suns-address-gets-reportedly-blacklisted-for-transferring-9m-wlfi" rel="noopener noreferrer nofollow">blacklisted</a> the wallet tied to Sun last year after it moved approximately $9 million in WLFI, effectively freezing his tokens and cutting off any ability to sell.
That decision has proven costly to sit with. Blockchain analytics platform <a href="https://intel.arkm.com/explorer/entity/justin-sun" rel="noopener noreferrer nofollow">Arkham</a> estimates Sun's frozen position, roughly 544.71 million tokens, is now worth around $44.65 million, down more than $80 million from earlier valuations.
<figure><a href="https://intel.arkm.com/explorer/entity/justin-sun" rel="noopener noreferrer nofollow"></a>
 <figcaption>
 Justin Sun's wallet as per Arkham
 </figcaption>
</figure>
<h2 id="what-comes-next">What comes next</h2>
Despite the defensive tone, WLFI did offer one concrete concession to early investors: confirming that a governance proposal to unlock locked tokens would be posted to its forum next week, ahead of a formal community vote.
The project also announced an upgrade to its USD1 stablecoin, highlighting new features including gasless transfers for AI agents, agentic-native payment infrastructure support, and compliance-grade controls for frozen funds.&nbsp;
The team framed USD1 as one of the most technically capable stablecoins in the market and positioned the upgrade as evidence of long-term momentum.
<a href="https://www.thestreet.com/crypto/markets/eric-trump-joins-world-liberty-financial-treasury-company-before-wlfi-token-launch" rel="noopener noreferrer nofollow">Related: Eric Trump joins World Liberty Financial treasury company before WLFI token launch</a>

Trump-backed token falls over 12% amid liquidity, debt concerns

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