Title: WLFI’s Rocky Start: Oversupply, Justin Sun, and HTX Dumping Concerns
The launch of World Liberty Financial’s (WLFI) governance token was one of the most hyped events in the crypto space this year, backed by the Trump family and drawing heavyweights like Justin Sun. However, since its debut on September 1, 2025, WLFI has been on a steep downturn, losing over 40% of its value, sliding from a high of $0.33 to below $0.18. 😱 The market’s buzzing with speculation, and two key factors are raising eyebrows: an unexpectedly high circulating supply and allegations of dumping by Justin Sun and his HTX exchange. Let’s unpack what’s happening and what it means for investors.
A Rough Launch and Oversupply Woes
WLFI kicked off with a massive fully diluted valuation (FDV) of around $30–40 billion, briefly ranking it among the top 50 cryptocurrencies. However, the token’s circulating supply—24.66 billion out of 100 billion tokens—has been a sore point. That’s over 25% unlocked at launch, which is hefty for a new project and has fueled volatility. Early investors, including whales, sold off nearly 700 million tokens within hours of trading, contributing to a 31% price drop from $0.33 to $0.21. 😬
The WLFI team has tried to curb this by burning 47 million tokens (0.19% of circulating supply) and proposing a buyback-and-burn program funded by protocol fees. This deflationary move aims to reduce supply and boost long-term value, but with only a small fraction burned so far, the market hasn’t fully stabilized. The high initial supply, combined with whale activity, has left investors jittery about further dumps.
Justin Sun’s Role: Support or Sabotage?
Justin Sun, the Tron founder and a major WLFI backer, is at the center of the storm. He acquired 3 billion WLFI tokens, including 600 million unlocked at the Token Generation Event (TGE), valued at around $200 million. His total holdings are reportedly worth $891 million, making him the largest outside investor in WLFI. Sun initially pledged to hold his tokens long-term, emphasizing his commitment to the project and its USD1 stablecoin. But recent on-chain data has sparked controversy.
Between September 2 and 4, Sun transferred 5.289 million WLFI tokens ($1.19 million) to HTX, the exchange he controls, and another $9 million worth (50–60 million tokens) to various exchanges. This triggered suspicions of dumping, as WLFI’s price tanked further. On September 4, WLFI’s team blacklisted Sun’s wallet, freezing 540 million unlocked tokens ($101 million) and 2.4 billion locked tokens ($452 million). The project claimed Sun and HTX were manipulating prices, possibly to buy low after selling user deposits. 😠
Sun fired back on X, calling the transfers “generic exchange deposit tests” and denying any sales. He argued the amounts were too small to impact the market and reaffirmed his commitment to holding. However, skepticism persists, especially since HTX’s WLFI Flexible Earn product, offering a 20% APY, has drawn liquidity but also raised questions about whether Sun’s moves were for yield farming or market manipulation.
HTX’s Role in the Drama
HTX, under Sun’s leadership, has been a key platform for WLFI, listing the token and launching the high-yield Flexible Earn program. The 20% APY offer led to a temporary 9% price surge to $0.2516 on September 2, but the gains were short-lived. On-chain data suggests HTX may have facilitated sales of user deposits, contributing to downward pressure on WLFI’s price. The blacklist of Sun’s wallets was partly justified by claims that an exchange (implied to be HTX) was systematically dumping tokens, forcing investors to repurchase on the open market.
This has raised red flags about governance and decentralization. WLFI’s smart contract allows the team to blacklist addresses, a feature common in some DeFi tokens but controversial for a project claiming community-driven governance. If a figure as prominent as Sun can be frozen out, what does this mean for smaller investors? 🤔
What’s Next for WLFI?
The WLFI saga highlights the risks of high-profile, politically charged crypto projects. The token’s volatility, driven by a large circulating supply and whale activity, underscores the challenges of balancing hype with stability. The team’s efforts to reduce supply through burns and buybacks are steps in the right direction, but they’ve yet to restore investor confidence. CoinMarketCap data shows WLFI’s market cap at around $4.45–$6.05 billion, with daily trading volumes hitting $1.4–$4.4 billion, reflecting intense speculation.
For traders, the situation offers both risks and opportunities. The 20% APY on HTX could attract yield farmers, but potential dumps from unlocked tokens remain a concern. Technical indicators like RSI suggest WLFI may be oversold, hinting at a possible rebound if support levels hold around $0.15–$0.18. However, analysts like Ali Martinez warn that a drop to $0.10 is possible if bearish sentiment persists.
Final Thoughts
WLFI’s launch has been a wild ride, with Justin Sun’s involvement and HTX’s actions amplifying the drama. The project’s ties to the Trump family add a layer of intrigue, but they also invite scrutiny over governance and transparency. For Steemit’s crypto enthusiasts, this is a reminder to dig into on-chain data, monitor whale activity, and approach high-volatility tokens with caution. What do you think—can WLFI recover, or is it headed for further turmoil? Drop your thoughts below! 🚀
Sources: CoinGecko, CoinMarketCap, Cryptonews.com, Cointelegraph, Blockchain.news, Yahoo Finance, Cryptopolitan, Coinpedia.org
Tags: #WLFI #Crypto #DeFi #JustinSun #HTX #TokenBurn #CryptoMarket
Note: This post is for informational purposes only and not financial advice.