WLFI price decline and restricted access deepen losses for major token holder
Crypto entrepreneur Justin Sun has seen the value of his locked World Liberty Financial (WLFI) tokens fall by approximately $60 million since September, according to on-chain analysis. The decline comes as Sun remains blacklisted by the World Liberty protocol, preventing him from accessing or transferring his holdings amid a sharp downturn in the token’s market price.
The situation began after an address linked to Sun moved roughly $9 million worth of WLFI tokens, triggering a response from the project. The protocol subsequently blacklisted the address, freezing the tokens and blocking any outbound or inbound transfers. As a result, Sun’s WLFI holdings have remained inaccessible for more than three months.
Blockchain analysts note that the blacklisting remains active, with no indication that restrictions have been lifted. During this period, WLFI has experienced a significant price decline, compounding the impact of the lockup.
Sun was among the most prominent supporters of the project, committing an estimated $175 million to tokens associated with the ecosystem. This included a large allocation to WLFI, the project’s governance token, as well as substantial purchases of a related memecoin. Despite this backing, Sun’s position within the ecosystem appears increasingly isolated.
Following the freeze, Sun publicly stated that his tokens were “unreasonably frozen”, emphasizing that his involvement was intended to support long-term ecosystem growth rather than short-term trading.
Since its market debut in September, WLFI is down more than 40%, significantly eroding the value of locked holdings. The prolonged restriction has turned the decline into a realized paper loss for Sun, with no immediate resolution in sight.The episode highlights the risks of centralized controls within decentralized finance, particularly for large holders whose assets can be frozen during disputes or governance actions.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.