Once WLFI’s largest outside backer, Sun is going public days after the Trump-family venture borrowed $75 million against its own token on a DeFi protocol advised by one of its own insiders.
What to know:
- Justin Sun, once a major backer of World Liberty Financial, has publicly broken with the project, accusing its team of treating users like a «personal ATM» and extracting illegitimate fees.
- The backlash follows WLFI’s move to deposit 5 billion WLFI tokens on DeFi lender Dolomite and borrow about $75 million in stablecoins, a trade that briefly pushed a key pool to 100 percent utilization and locked out ordinary depositors.
- Sun, whose WLFI wallet was frozen in 2025 as part of a broader blacklist, now calls himself the project’s «first and single largest victim» and alleges WLFI’s governance votes were neither fair nor transparent, as the token trades around $0.079 after a sharp weekly decline.
Trump-linked World Liberty Financial has lost a key backer after its $75 Million DeFi loan tied up user liquidity, with Justin Sun publicly breaking and criticizing the project’s treatment of investors.
“Every action taken by the WLFI team to extract fees from users and to treat the crypto community as a personal ATM is illegitimate,” Sun wrote.
The criticism comes days after World Liberty Financial deposited 5 billion WLFI tokens as collateral on the DeFi lending platform Dolomite and borrowed about $75 million in stablecoins.
The deposit still dominates Dolomite, accounting for a majority of the protocol’s roughly $794 million in total supply liquidity.
At its peak earlier this week, the USD1 pool hit 100% utilization, temporarily locking ordinary stablecoin depositors out of their funds. As of Sunday, the pool had eased to roughly 82% utilization, with about $158 million borrowed against $193 million supplied.
Dolomite co-founder Corey Caplan also serves as an advisor to World Liberty Financial, a dual role that onchain analysts have described as functionally that of CTO. To accommodate WLFI’s deposit, Dolomite raised its WLFI supply cap to 5.1 billion tokens.
“These actions have nothing to do with me. They have nothing to do with the investors who believed the promises this project made,” Sun continued. “We oppose every one of these actions in the strongest possible terms.”
Frozen out of WLFI
Sun had helped stabilize the project early on by purchasing $30 million in WLFI tokens after a lukewarm launch raised questions about investor appetite.
Last September, WLFI froze Sun’s wallet, locking the Tron founder out of 595 million unlocked tokens worth about $107 million at the time.
WLFI said the action was part of a broader move against 272 wallets it linked to phishing attacks and compromised support channels, insisting it «only intervenes to protect users, never to silence normal activity.»
Sun is frames the September freeze as the project’s original sin.
«I am the first and single largest victim,» he wrote Sunday, «as a result of their wrongful blacklisting of my WLFI token wallet back in 2025, that violates basic investor rights and blockchain principles of fairness.»
Sun also took aim at WLFI’s governance process, alleging that votes cited to justify the freezes «were not conducted through a fair or transparent process,» that «key information was withheld from voters,» and that «the outcomes were predetermined.»
Notably, he carefully separated his attack on WLFI’s operators from the President himself, opening his statement by reaffirming that he has «always been an ardent supporter of President Trump and his crypto-friendly policy» and directing his denunciation at «the bad actors at WLFI.»
WLFI’s co-founder Zak Folkman did not immediately respond to a request for comment sent by CoinDesk to his Telegram.
WLFi is trading at $0.079, according to CoinDesk data, down 18% over the past week.