Key Takeaways:
World Liberty Financial’s WLFI token saw a record 17.4 trillion tokens moved on May 18 after its affiliated stablecoin, USD1, was listed on Binance for a new bitcoin trading pair, according to on-chain data. The surge in activity allowed long-term holders to exit positions in the controversial Trump-family-linked cryptocurrency.
On-chain data shows the network recorded its highest-ever realized profit, with a net 1.8 billion WLFI tokens sold for a profit on May 18. The "age consumed" metric, which measures the movement of dormant tokens, also hit an all-time high, indicating that long-time investors took advantage of the liquidity event. The new USD1/BTC trading pair on Binance, which went live on May 20, allows traders to use the stablecoin as collateral for bitcoin futures.
The flurry of profit-taking comes after a brutal slide in WLFI’s value, which has fallen nearly 88% from its all-time high. The token was trading near $0.07, down from a peak of $0.33 in September, according to CoinMarketCap data. The decline has been driven by a series of controversies, including a lawsuit with crypto billionaire Justin Sun and reports of undisclosed token sales. AI Financial, a publicly traded company that acts as a treasury for WLFI, recently warned in an SEC filing of “substantial doubt” about its ability to continue operating after posting a $271.3 million net loss, largely from unrealized losses on its WLFI holdings.
The situation highlights the extreme volatility and risks associated with politically-linked crypto projects. While the Trump family has reportedly earned over $1.5 billion from World Liberty Financial, including an estimated $660 million from "white glove" private token sales, the project has been dogged by accusations of insider dealings and a lack of transparency. The ongoing legal battle with Justin Sun, who alleges his tokens were unfairly frozen, has further damaged investor confidence. The project's troubles come as the U.S. Senate considers the CLARITY Act, a crypto regulation bill that may include provisions restricting the digital asset transactions of political figures and their families.
This article is for informational purposes only and does not constitute investment advice.
