World Liberty Financial has sold an additional 5.9 billion WLFI tokens to private investors, adding to more than $550 million already raised. The WLFI price dropped 15% since yesterday and more than 30% over the past four days, as new tokens entered the market while most investors remain locked out of their holdings.
Supply and Liquidity Imbalance
According to Wu Blockchain, around 80% of early investor holdings remain locked, leaving only a small portion of the WLFI supply tradable. This structure creates uneven pressure, where the tradable portion absorbs the bulk of selling activity, amplifying price drops when sentiment weakens. Reports suggest the new tokens came from internal allocations, with proceeds tied to founder-affiliated entities.
Governance Vote Sparks Dilution Fears
A governance proposal passed on April 30 with a 99.5% approval rate, approving the restructuring of 62.3 billion WLFI tokens—over 60% of total supply. Despite the high approval, the market reacted negatively. The scale of future tokens raised fears about dilution. Critics described the vote as coercive, warning that holders who failed to opt in risk having their tokens locked indefinitely.
Legal and Lending Risks
Justin Sun filed a lawsuit tied to World Liberty Financial involving a reported $75 million investment that was frozen, along with claims that governance rights were removed. Wallet freezes connected to the case have affected hundreds of addresses, raising questions about decentralization and control.
Additionally, the project used WLFI tokens as collateral to borrow about $75 million in stablecoins on platforms like Dolomite. Falling prices create liquidation risk, as the collateral value drops with WLFI’s decline.
Lockup Structure Extends Through 2028
Roughly 75% of total WLFI supply remains locked and non-transferable as of May 2026. Only 24.67% of tokens are tradable on exchanges like Binance. Early supporters holding 17 billion tokens now face a two-year lockup, with gradual release starting in April 2028. Founders and advisors with 45.2 billion tokens face an even longer release period. Holders must also stake tokens for at least 180 days to maintain voting rights and earn rewards.
