WLFI Hits Record Low as Treasury Borrowing Stokes Liquidity Fears
World Liberty Financial's WLFI extended its slide as liquidity and collateral-management concerns unsettled traders. The token fell nearly 12% over the past 24 hours to about $0.0818, its lowest level since launching in 2025. Losses widened to roughly 15% over the week and 17% over the month as selling accelerated and charts deteriorated.
Focus shifted to onchain activity tied to the project's treasury operations. CoinDesk reported that World Liberty Financial deposited billions of WLFI governance tokens as collateral in the Dolomite lending protocol and borrowed tens of millions of dollars in stablecoins, including USDC and USD1. Onchain data from Arkham showed a wallet pledging around five billion WLFI tokens and drawing about $75 million in borrowings. More than $40 million was later sent to Coinbase Prime, adding to market scrutiny.
The borrowing pushed Dolomite's lending pool to full utilization, temporarily limiting withdrawals for other depositors and amplifying concerns about liquidity stress. World Liberty Financial said on X that the criticism was "FUD" and argued liquidation risk remains remote. Questions persisted after observers pointed to advisory links between the project and Dolomite cofounder Corey Caplan as a potential conflict of interest.
The project's buyback activity also drew attention. WLFI disclosed it spent $65.58 million to purchase 435.3 million tokens at an average price of $0.1507.
Investor exposure came into view as well. Tron founder Justin Sun is reported to have invested $30 million initially and later increased exposure toward $75 million. Part of his position remains frozen due to wallet restrictions, leaving about 545 million WLFI tokens valued near $45 million.
Technicals continue to point lower. The RSI is hovering near 30, putting WLFI close to oversold territory, while MACD signals sustained downside momentum. Traders are watching support around $0.079; a break could open moves toward $0.075 and $0.070. Despite oversold readings, buyers have yet to show enough strength to shift sentiment, leaving markets cautious as they look for clearer signs of accumulation.
