TRON founder Justin Sun’s WLFI wallet was blacklisted shortly after a $9 million transaction, shaking market confidence and sending the Token price plunging 22%.
A week after its launch, decentralized finance (DeFi) project World Liberty Financial (WLFI) faced its first shock. According to onchain data from Nansen and Arkham, Mr. Sun transferred 50 million WLFI to the HTX exchange. The move was immediately blocked by the project by locking its wallet, raising suspicions that WLFI was trying to limit the sell-off from large investors to control the price decline.
The incident attracted more attention because Justin Sun had previously affirmed that he would not sell anytime soon and committed to a long-term commitment to the project. On social network X, he explained that this was just a few normal floor loading tests and had no impact on the market. Sun's spokesperson also confirmed that the two sides were maintaining active exchanges.
However, the market reacted negatively. After peaking at $0.32, WLFI fell below $0.18, losing more than 22% of its value in just a few days, according to data from CoinMarketCap. WLFI is now among the top 10 tokens with the most bearish community sentiment.
To reassure investors, World Liberty Financial has burned 47 million Token to reduce the circulating supply, but this is insignificant compared to the total supply of nearly 100 billion. The project also said it is XEM implementing a buyback program using protocol fees, with all bought back Token being burned permanently.
The event raises questions about the level of decentralization and freedom of trading in DeFi projects, when controls can be suddenly imposed on even the most influential investors.
