David Canellis

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The “<a href="https://knowyourmeme.com/memes/its-all-so-tiresome">it’s all so tiresome</a>” meme also comes to mind. Except the context surrounding the original scene doesn’t really apply. Unlike in the Empire of Dust documentary, there are lots of people doing great work in crypto, tirelessly so, and there’s plenty about the state of blockchain development to be excited about.



Instead, crypto is psychological torture in the same way that medieval tickling might be. In the early 16th century, the Italian monk Franciscus Brunus de San Severino described a dastardly practice known as the goat’s tongue, whereby townspeople would coat the feet of a criminal locked up in the stocks with salt. A goat would then lick the salt off the feet while commoners tickled them with feathers.



It’s not clear whether the goat’s tongue was actually a real punishment. But I imagine that it’s familiar to anyone who is unfortunate enough to be unceremoniously pulled towards crypto for one reason or another, whether it’s interest, work, curiosity, academics or simply the potential to make serious money.



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1216" height="1082" src="https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image-3.png?w=1024&amp;h=1024" alt="" class="wp-image-106950" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image-3.png?w=1216 1216w, https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image-3.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image-3.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image-3.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image-3.png?w=289 289w, https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image-3.png?w=293 293w, https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image-3.png?w=246 246w, https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image-3.png?w=80 80w" sizes="auto, (max-width: 1216px) 100vw, 1216px" /><figcaption class="wp-element-caption">A <a href="https://en.wikipedia.org/wiki/Tickle_torture#/media/File:Rothenburg_Germany_Torture_Museum_(4139740862).jpg">painting</a> at the criminal museum in Rothenburg, depicting the dreaded goat’s tongue</figcaption></figure>



<a href="https://x.com/post_polar_">Paul J. Dylan-Ennis</a> in 2021 <a href="https://www.coindesk.com/business/2021/11/10/the-trash-moat-when-the-media-lies-about-crypto">described</a> crypto as a world surrounded by a trash moat of information — a barrier of toxic clickbait sludge that regular people must wade through to reach anything worthwhile:



“What happens in the trash moat rarely reaches the shores of mainstream crypto. It occurs in the sweet spot just beyond the attention of the clued-in observer, who is typically focused on high-minded talk of regulation, venture capital funding and whatever is currently hot, like NFTs, and yet it happens right there in public.”



The tickling torture described by our monk Franciscus Brunus would certainly feel a lot like the tide of that trash moat ripping past my ankles while I soak my feet on the shore.



Objectively, the details surrounding World Liberty Financial, a project for <a href="https://worldlibertyfinancial.com/about">banking the unbanked</a>, are hilarious and excruciatingly painful, all at the same time.&nbsp;



<ul class="wp-block-list">
<li>The white paper is really a “<a href="https://static.worldlibertyfinancial.com/docs/intl/gold-paper.pdf">gold paper</a>.”</li>



<li>President Trump is “Co-Founder Emeritus,” and his face is all over the gold paper.</li>



<li>There is no live app, but the WLFI token has a $6.6-billion market cap and a $24-billion FDV.</li>



<li>Justin Sun was WLFI’s largest backer and now <a href="https://x.com/arkham/status/1962532967437242537">holds</a> more than 3% of the circulating supply.</li>



<li>WLFI is a governance token with a buy-back-and-burn strategy. Large holders, including a firm linked to the Trump family, decide when token allocations are unlocked and can be sold.</li>



<li>Binance <a href="https://www.bloomberg.com/news/features/2025-07-11/trump-s-crypto-link-with-binance-raises-conflict-of-interest-questions">reportedly</a> wrote the smart contract for USD1, a stablecoin in the World Liberty Financial universe, as CZ seeks a pardon (CZ denies Binance’s involvement).</li>



<li>The Trump family is technically $5 billion richer thanks to their stake in WLFI, per <a href="https://www.wsj.com/finance/currencies/trump-family-amasses-6-billion-fortune-after-crypto-launch-567faec5">WSJ</a>, making their crypto investments more valuable than their real estate.</li>
</ul>



<figure class="wp-block-image size-large is-resized"><img loading="lazy" decoding="async" width="1230" height="946" src="https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image-4.png?w=1024&amp;h=1024" alt="" class="wp-image-106951" style="width:716px;height:auto" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image-4.png?w=1230 1230w, https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image-4.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image-4.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image-4.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image-4.png?w=334 334w, https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image-4.png?w=339 339w, https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image-4.png?w=285 285w, https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image-4.png?w=80 80w" sizes="auto, (max-width: 1230px) 100vw, 1230px" /><figcaption class="wp-element-caption">WLFI’s token claim temporarily pushed<a href="https://blockworks.co/news/wlfi-claim-eth-gas"> gas fees over $100</a> yesterday. Meanwhile, 26% of WLFI’s first-day trading volume occurred on Binance, with more spread across other offshore exchanges including Bybit, Upbit, MEXC and others. Uniswap contributed around 3%. (H/T: <a href="https://x.com/rod_data">Rod</a>, Blockworks Research analyst).</figcaption></figure>



We could unpack and debate the finer points of WLFI’s tokenomics all day. Perhaps at the end of it, we’d decide whether World Liberty Financial is a net positive for the crypto space, whatever that might mean. I’m just not sure it will matter anymore.&nbsp;



Those of us who have learned how to tune out the trash moat — the constant low quality noise sloshing around crypto — may find it vastly more difficult to do so from here. At least, until a lengthy bear market cleanses the waters once again.



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Is World Liberty Financial good for crypto? It doesn’t matter anymore

Macauley Peterson

An otherwise quiet US Labor Day Monday in markets was disrupted onchain by the opening of claims on <a href="https://blockworks.co/price/wlfi">WLFI</a> tokens at 8:00 am ET.



Ethereum <a href="https://blockworks.co/tag/gas-fees">gas fees</a> quickly spiked into triple digits, the highest readings in 2025, as recipients rushed to claim tokens, alongside immediate secondary trading.



<a href="https://blockworks.co/tag/world-liberty-financial">World Liberty Financial</a> had flagged the unlock flow <a href="https://x.com/worldlibertyfi/status/1960068943562870830">last week</a> and announced its “Lockbox” ahead of today’s window. 



One reason on-chain swapping skewed high: several large centralized exchange listings were scheduled for later in the day. OKX, for example, set <a href="https://x.com/okx/status/1962486127220175254">spot trading</a> for WLFI/USDT to begin at 9 am ET, after the claims window was already live — pushing early flow toward <a href="https://blockworks.co/tag/uniswap">Uniswap</a> in the interim.



Etherscan’s Gas Tracker showed the network’s median/base fee serge putting the WLFI token into the top spot on the site’s <a href="https://etherscan.io/gastracker#gasguzzler">Gas Guzzlers</a> list.



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="2048" height="457" src="https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image.png?w=1024&amp;h=1024" alt="" class="wp-image-106934" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image.png?w=2048 2048w, https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image.png?w=1536 1536w, https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image.png?w=428 428w, https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image.png?w=470 470w, https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image.png?w=389 389w, https://blockworks-co.imgix.net/wp-content/uploads/2025/09/image.png?w=80 80w" sizes="auto, (max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">Source: <a href="https://etherscan.io/gastracker#gasguzzler">Etherscan</a></figcaption></figure>



While fees eased later, utilization remained elevated with a deep pending queue.&nbsp;



The Uniswap v3 WLFI pool on Ethereum registered over $20 million in volume within the first hour, according to <a href="https://www.coingecko.com/en/coins/world-liberty-financial">CoinGecko</a> as claims boosted DEX activity.



All this despite the fact the token drop was widely anticipated. WLFI’s unlock site outlined the process on August 25. Derivatives flows had already picked up into the event, with WLFI perps volumes <a href="https://www.coinglass.com/currencies/WLFI">jumping</a> to more than $3 billion ahead of the unlock.&nbsp;



After weeks of sub-1 gwei medians, the WLFI unlock is a reminder that large, coordinated claim events can still overwhelm blockspace on Ethereum, when thousands of users hit contracts at once. That had users complaining of gas fees upwards of $100 to execute the claim. As recently as this morning, a similar claim transaction would have cost less than $0.10.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">High gas prices is due to a high volume of users and network congestion you can retry later when gases are at the lowest&mdash; Jovanny Algandar | $WLFI (@jovannymontes8) <a href="https://twitter.com/jovannymontes8/status/1962495535622881770?ref_src=twsrc%5Etfw">September 1, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



For teams planning comparable unlocks or airdrops, today underscores the operational need to stagger claims, consider off-chain batching where appropriate, and set realistic user expectations around gas.



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WLFI claims send ETH gas over 100 gwei

Katherine Ross

This is a segment from the Empire newsletter. To read full editions, <a href="https://blockworks.co/newsletter/empire" target="_blank" rel="noreferrer noopener">subscribe</a>.



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At Permissionless last week, Empire co-host Jason Yanowitz sat down with World Liberty Financial’s Zak Folkman.



As Yanowitz pointed out, World Liberty Financial has <a href="https://blockworks.co/news/trump-backed-project-token-swaps">certainly garnered</a> a fair bit of controversy, although, Folkman said, “we’re not really doing anything controversial.”



Quick sidebar here: Folkman also went on to say that legacy media (meaning the New York Times and other larger news sources) are “corrupt” and try to create a narrative; he referred to the fact that they use unnamed sources and “unverified facts.” Given that Blockworks has previously reported on the project using anonymous sources, I wanted to explain that this is a normal practice in journalism.&nbsp;



<a href="https://blockworks.co/trust-ethics">Our goal is to report the truth</a>, and sometimes the way to do that is to keep a source anonymous. However, we have strict guidelines in place to ensure that every story that goes out is heavily vetted.&nbsp;



But let’s get back to Folkman, shall we? According to him, World Liberty Financial was already operating before Trump took office.



“We started our token sale even before [President Donald Trump] got elected…So, you know, this is a project that we&#8217;ve been working on for quite some time now. The entire goal was to build DeFi products that make Web3 technology available to people who are familiar in operating in a Web2 environment,” Folkman said.&nbsp;



Folkman, later on in the conversation, also said that the team’s fielded a lot of interest from public firms who want to use WLFI in corporate treasuries.&nbsp;



He said World Liberty plans to undergo an audit on its stablecoin, USD1, and that it would be putting its attestation report on its website “within the next few days.”



He added that they’re working closely with Chainlink as well, “to be the first stablecoin that&#8217;s going to implement Chainlink&#8217;s proof of reserves and securement.”



He also said that a mobile app is in the works.&nbsp;



“It&#8217;s something that we&#8217;ve been working on for a very long time now with some of the best partners and builders in the space, both on our team and companies that we&#8217;ve partnered with. And this is kind of the culmination of what I was talking about in terms of creating a Web2-style FinTech application that allows a non-native crypto user to be able to very easily deposit…get the benefit of earning through DeFi applications and [be] able to send and receive crypto between friends and family very easily,” he told Yanowitz.



So there you have it. The World Liberty Financial empire keeps growing.



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World Liberty Financial has a mobile app ‘in the works’

Crypto exchange giant Binance announced that it offboarded a market maker Tuesday, saying that it removed the unnamed entity in light of “misconduct” around the MOVE token.



The unnamed market maker <a href="https://www.binance.com/en/support/announcement/detail/478515187fab440fa80e56137c148a1b">sold 66 million</a> MOVE tokens “with little buy orders” back on December 12, scoring a $38 million USDT profit before being offboarded by Binance on March 18.&nbsp;



In turn, Movement Labs said it plans to buy back $38 million worth of MOVE tokens.&nbsp;



Following Binance’s action today, Movement Labs and the Movement Network Foundation said they “had absolutely no knowledge that this was happening.”



“We chose to work with this market maker as they had already supported projects in the Movement ecosystem,” a press statement said.&nbsp;



Crypto sleuth ZachXBT said on X that an investor had told him that the market maker in question was Web3Port.&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Update an investor tells me it’s <a href="https://twitter.com/Web3Port_Labs?ref_src=twsrc%5Etfw">@Web3Port_Labs</a> so avoid doing business with them at all costs and check their recent reposts for other projects they are potentially working with.&mdash; ZachXBT (@zachxbt) <a href="https://twitter.com/zachxbt/status/1904499840089772445?ref_src=twsrc%5Etfw">March 25, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Binance and Web3Port did not respond to requests for comment from Blockworks. Movement Labs shared its original post about the incident and said it would not comment further.&nbsp;



The market maker, Binance said in the announcement, was <a href="https://www.binance.com/en/support/announcement/detail/4a5fa79a6c174db29c43122db732af1e">tied</a> to another market maker from a separate investigation into GoPlus Security and MyShell. Both were “offboarded” by the exchange.



An examination of Web3Port’s X account history shows prior engagement with posts from Movement Labs. In February, <a href="https://cointelegraph.com/press-releases/web3port-foundation-commits-100m-to-boost-liquidity-on-novastro-the-first-rwa-project-on-movement">according to a sponsored post</a> on Cointelegraph, the Web3Port Foundation sought to “deepen its strategic partnership” with an L2 on Movement.



According to its website, Web3Port Labs “provides comprehensive full-cycle acceleration and investment support for Web3 projects at all stages. With our primary market investment fund and secondary market liquidity fund, we facilitate the complete lifecycle of startups, including investment, financing, management and exit, through a one-stop Web3 accelerator platform.”



On Crypto Twitter, folks pointed out that Web3Port prominently displayed its exit strategies for the projects it supports and incubates.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">What happened was that the team dumped about $40 million worth of tokens on users, and the market maker (MM) took the blame. Such scammy team, should send it to 0&mdash; Molly (@bigmagicdao) <a href="https://twitter.com/bigmagicdao/status/1904497973779972595?ref_src=twsrc%5Etfw">March 25, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Moonrock Capital’s Simon Dedic said, “the reality is that only a handful of market makers in crypto can actually be trusted.”



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Update on the <a href="https://twitter.com/movementlabsxyz?ref_src=twsrc%5Etfw">@movementlabsxyz</a> situation: It looks like the main scapegoat in all of this is <a href="https://twitter.com/Web3Port_Labs?ref_src=twsrc%5Etfw">@Web3Port_Labs</a>, the market maker behind <a href="https://twitter.com/search?q=%24MOVE&amp;src=ctag&amp;ref_src=twsrc%5Etfw">$MOVE</a>. Not surprising at all &#8211; just the first time a CEX is actually taking action and making it public. For years, I’ve been hearing horror… <a href="https://t.co/HYMGLn0y5G">pic.twitter.com/HYMGLn0y5G</a>&mdash; Simon (@sjdedic) <a href="https://twitter.com/sjdedic/status/1904526314456908039?ref_src=twsrc%5Etfw">March 25, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Meanwhile, Mike Dudas of 6th Man Ventures said it was “clear” that Web3Port wasn’t a real market maker.&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">yes, pretty clear to anyone that this isn&#39;t an actual &quot;market maker&quot;<a href="https://t.co/FaZWmM0hs8">https://t.co/FaZWmM0hs8</a>&mdash; Mike Dudas (@mdudas) <a href="https://twitter.com/mdudas/status/1904498785775944117?ref_src=twsrc%5Etfw">March 25, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Movement’s response — which was to offer “transparency” in its post about the situation, though it failed to name the market maker — revived criticisms of the project across Crypto Twitter.



The long-running discourse around Movement Labs began before its token launch late last year, with user @0xSisyphus <a href="https://x.com/0xSisyphus/status/1864261624657301697">sharing a screenshot</a> of what was allegedly a MOVE key opinion leader document. In response, Movement’s Rushi Manche <a href="https://x.com/rushimanche/status/1864316507465110015">said</a> that it came from a marketing agency the firm had “cut off” a year ago.



But other criticisms have surfaced, including potential ties to World Liberty Financial’s token swap deals, as <a href="https://blockworks.co/news/trump-backed-project-token-swaps">previously reported by Blockworks</a>. Movement, at the time, told Blockworks that it had not engaged with WLFI or purchased any tokens.



Others, like Eric Conor, <a href="https://x.com/econoar/status/1884264978401878509/photo/2">pointed out</a> the timing of WLFI buying MOVE, which happened right before a <a href="https://x.com/tier10k/status/1884252132540571895">news headline</a> about Elon Musk’s DOGE showing interest in Movement. However, Manche <a href="https://x.com/Timccopeland/status/1884651848226750909">denied</a> any insider trading allegations at the time.



Other allegations, such as angel investors knowing Movement Labs was a “<a href="https://x.com/0xBalloonLover/status/1894466761300251027">pump and dump</a>,” have propagated on Crypto Twitter. X account Fede Intern also publicly warned builders away from Movement Labs last month.&nbsp;



“The technology is not there in any way or form, and this comes from someone who loves the MoveVM created by Aptos and SuiNetwork. The idea behind Movement is good, but the execution and the token launch have been very strange, to say the least,” they wrote.&nbsp;



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">After sufficient analysis on our side, we can publicly say that we recommend any builder to stay as far away as possible from <a href="https://twitter.com/movementlabsxyz?ref_src=twsrc%5Etfw">@movementlabsxyz</a>. We have nothing personal against them; I only had a few interactions with the founder and liked him. We even have common friends who…&mdash; Fede’s intern 🥊 (@fede_intern) <a href="https://twitter.com/fede_intern/status/1894349781918437509?ref_src=twsrc%5Etfw">February 25, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Movement elsewhere faces an $18.4 million lawsuit filed in December by the former head of financial relations at the IOTA Foundation, Daniel Simerman, who alleges breach of contract.



According to the complaint, co-founder Rushi Manche and Cooper Scanlon met with Simerman in April of 2023 to “discuss how to obtain funding for their business, how to optimize their product offering, how to manage and grow blockchain organizations at this scale, and the engagement of plaintiff’s services on a compensated basis.”



Movement declined to comment on the criticisms it faces after multiple attempts to reach the team.&nbsp;



Disclosure: Blockworks cofounder <a href="mailto:jason@blockworks.co">Jason Yanowitz</a> is an angel investor in Movement Labs.



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Movement Labs draws scrutiny following Binance’s market maker investigation

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Yesterday, former Binance CEO Changpeng Zhao praised “USD1” and posted, “Welcome to BNB Chain!”



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Welcome to <a href="https://twitter.com/BNBCHAIN?ref_src=twsrc%5Etfw">@BNBChain</a>! According to BSCScan, the smart contract was deployed 20 days ago. Build! 👏<a href="https://t.co/qr22y4pXqE">https://t.co/qr22y4pXqE</a> <a href="https://t.co/J0TvwEnUin">https://t.co/J0TvwEnUin</a>&mdash; CZ 🔶 BNB (@cz_binance) <a href="https://twitter.com/cz_binance/status/1904206000456077411?ref_src=twsrc%5Etfw">March 24, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
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A couple of hours later, World Liberty Financial noted that USD1 is not “currently tradable,” and seemingly took ownership of the new stablecoin.&nbsp;



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<blockquote class="twitter-tweet" data-width="550" data-dnt="true">USD1 is not currently tradable. Beware of scams and follow us here for all official announcements 🦅<a href="https://t.co/msnj0zLSp7">https://t.co/msnj0zLSp7</a>&mdash; WLFI (@worldlibertyfi) <a href="https://twitter.com/worldlibertyfi/status/1904231269111578790?ref_src=twsrc%5Etfw">March 24, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
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And, after a lot of speculation and even more texts sent out from yours truly, we finally have some answers this morning. USD1 will be minted on Ethereum and Binance Smart Chain blockchains, though the team isn’t ruling out future protocols, per a press release.&nbsp;



“WLFI’s USD1 will be 100% backed by short-term US government treasuries, US dollar deposits, and other cash equivalents,” the release said.



BitGo will custody the USD1 reserves. In a statement, CEO Mike Belshe praised the stablecoin as an advancement in “institutional-ready digital assets.”



“USD1 provides what algorithmic and anonymous crypto projects cannot — access to the power of DeFi underpinned by the credibility and safeguards of the most respected names in traditional finance,” said Zach Witkoff, WLFI co-founder.



It’s still unclear from the press release what role Wintermute was playing, though it looked like it was potentially in the mix (per <a href="https://etherscan.io/token/0x8d0d000ee44948fc98c9b98a4fa4921476f08b0d?utm_source=empire-blockworks.beehiiv.com&amp;utm_medium=newsletter&amp;utm_campaign=oracle-insights">Etherscan</a>). No word back from the Wintermute team yet, either.



WLFI just closed $550 million in token sales last week and, in an accompanying press release, said: “Over the last six months, WLFI has established key relationships with leading blockchain protocols and institutions including Ondo Finance, Ethena, Chainlink, Sui and Aave. These relationships have positioned WLFI to more rapidly build and deploy its upcoming platform, which is being purpose-built to democratize finance for millions.”



But the project hasn’t been without its criticism, with our very own Jack Kubinec <a href="https://blockworks.co/news/trump-backed-project-token-swaps">reporting last month</a> that it was courting other teams for token swaps.&nbsp;



Now we’ll just have to see what’s next for WLFI. And the biggest question is: What players are involved?



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BitGo to custody reserves of World Liberty Financial’s USD1 

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Here’s the thing about strategic reserves.



The name implies that whatever is in the reserve is a stockpile that can be utilized at some point in the future when the situation calls for it.



In the US, the government maintains a <a href="https://www.energy.gov/ceser/northeast-home-heating-oil-reserve">stockpile</a> of one million barrels of diesel fuel spread between Massachusetts, New Jersey and Connecticut — a trove of oil to be released to heat homes and businesses should there be a supply disruption somewhere down the line.&nbsp;



A strategic grain reserve does much the same thing, but for a critical food ingredient.



They do not necessarily have to directly benefit the general public, either. At one point, the government was also stockpiling helium, <a href="https://www.cfr.org/backgrounder/state-us-strategic-stockpiles">hoarding</a> it for use in military blimps, although these days the private sector handles that, and the helium instead is used for rockets and superconductors.



So what would a strategic crypto reserve actually be for? What future calamity could a portfolio of random coins help alleviate?



A bitcoin-only strategic reserve is the easiest to square. As far as coins go, it’s obviously the most resistant to major long-term corrections — it has always bounced back from its semi-regular 80% drawdowns.



BTC is also effectively uncorrelated with the rest of the crypto market — because it almost always leads it. That makes it the obvious choice for a strategic reserve.&nbsp;



After all, bitcoin’s primary modern use case is buying and holding long-term, which is about as close to an overarching goal for any strategic reserve as we’ve got right now. Maybe one day in the future, on some rainy day, the US could sell its bitcoin something, pay off some debt or otherwise fund initiatives for the common good.&nbsp;



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXcHjx1_-Z4PWn9T20BR3HIjnpjZWLRruCdnng5au0MQFGH1x4vEYuIOOiuvkBG2J9PfMPhW57RHCRpimfuLJYpAyXnlMQxiDrLBkUQh8DmoO3qcBKaXqcdhC12AAQfj7qjjB9B5UQ?key=JOAUs5lZRL4PgoRC0B8h7JAu" alt=""/></figure>



As it stands, the nearest things we have to a US strategic crypto reserve are the $20 billion BTC seized through criminal cases over the years — which is still on track to be liquidated at some point, although perhaps not in the short term.



Then, there’s the growing strategic reserve maintained by Trump’s upcoming DeFi project World Liberty Fi. It’s so far spent $303 million on seven different coins since the end of November, as recently as last week, with nearly two-thirds of it going to ETH.&nbsp;



Tracking the value of World Liberty Fi’s reserve is more difficult after it moved most of it into Coinbase Prime custody earlier this month. But after piecing together the onchain data, I calculated that the portfolio was worth just over $261 million earlier this morning.



That puts it in the red by about 14% on all of its purchases to date (as shown by the blue line on the chart above, while the other lines show the overall performance of each position).&nbsp;



TRX is the only hold still green, but only barely, with ENA the worst — World Liberty Fi is down around $2.7 million on its ENA positions right now. The portfolio is largely being held up by bitcoin, with it down around $30 million in its ETH compared to $5 million on BTC.



Perhaps there’s no reason for World Liberty Fi’s strategic reserve to exist at all, other than basic treasury management common to many crypto projects, not to mention the <a href="https://blockworks.co/news/trump-backed-project-token-swaps">reported token swap deals</a> relayed by Lightspeed’s Jack Kubinec.



But if it really turns out that World Liberty Fi’s crypto portfolio is in fact Trump’s <a href="https://blockworks.co/news/trump-strategic-crypto-reserve">anticipated strategic reserve</a>, then it will need to be actively managed, especially as we get closer to the next bear market.



If World Liberty Fi’s portfolio drops further, labeling it as “strategic” could get embarrassing.



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Why a US crypto strategic reserve would need active management

Jack Kubinec

World Liberty Financial, the crypto platform backed by President Donald Trump, has been courting blockchains to take part in “token swap” deals, two sources with knowledge of the matter told Blockworks.



Representatives for World Liberty Financial have been approaching blockchain teams with an offer: buy at least $10 million worth of unlaunched WLFI tokens with a 10 percent fee, and World Liberty Financial will buy the same amount of the blockchain’s native token.&nbsp;



A message from a World Liberty Financial representative shared with Blockworks said the WLFI tokens would be transferred at a $1.5 billion fully diluted valuation, which is crypto verbiage for the theoretical total value of a given crypto token.&nbsp;



The World Liberty Financial platform is expected to launch in Q3 of this year at a $1.5 billion FDV, the representative’s message said. The message insisted that none of the tokens could be subject to a vesting period, and the minimum buy in for a token swap partnership was set at $10 million.&nbsp;



A source at a second blockchain project, granted anonymity to discuss private business dealings, confirmed to Blockworks that they had received the same offer with the caveat that while $10 million was the minimum buy in, it would take $15 million to receive priority treatment from World Liberty Financial.



World Liberty Financial will aim to help users access third-party DeFi applications to do things like earn yield on stablecoins or borrow cryptoassets, according to the project’s official documentation. President Trump <a href="https://blockworks.co/news/on-the-margin-newsletter-trump-family-defi-venture">began promoting</a> the project while still on the campaign trail last year.&nbsp;



Right now, the only thing users can do on World Liberty Financial’s website is buy the forthcoming WLFI token. According to the website, roughly 24 billion WLFI tokens have been sold at $0.05 apiece, which would total some $1.2 billion.&nbsp;



Chinese crypto entrepreneur Justin Sun <a href="https://x.com/justinsuntron/status/1881169556506546485">claimed</a> that TronDAO has snapped up $75 million.



Only President Trump’s son Eric, who is on the project’s “board of managers,” is directly involved with World Liberty Financial, but the Trump family has financial upside nonetheless.&nbsp;



An LLC affiliated with President Trump and his family is entitled to 60% of the project’s equity, 75% of the fee revenue generated by the WLFI token sale, and 22.5 billion WLFI tokens, worth some $1.1 billion at the public sale price.&nbsp;



World Liberty Financial’s crypto wallet is public. ETH accounts for about half of the project’s $378 million in crypto, data from Arkham <a href="https://intel.arkm.com/explorer/entity/worldlibertyfi">shows</a>. The rest of the holdings include Justin Sun-linked wrapped bitcoin, staked ether, and USDC, as well as a smattering of smaller tokens.&nbsp;



Scoring a spot on World Liberty Financial’s balance sheet has become a point of pride for crypto projects.



“[We] would like to thank @worldlibertyfi for their continued support and look forward to an [American] future for MOVE,” Movement Labs co-founder Rushi Manche wrote on X after World Liberty Financial acquired $2 million in its native token.



“Movement has not purchased any WLFI tokens or engaged with WLF,” a Movement Labs spokesperson told Blockworks.



The message shared with Blockworks says token swap candidates will participate in an initial meeting followed by a video meeting with World Liberty Financial co-founder Zak Folkman to finalize the deal.&nbsp;



Folkman and fellow World Liberty Financial co-founder Chase Herro previously built Dough Finance, a crypto platform that was hacked for $2 million in July 2024, CoinDesk previously <a href="https://www.coindesk.com/business/2024/09/03/inside-the-trump-crypto-project-linked-to-a-2m-defi-hack-and-former-pick-up-artist">reported</a>. The pair launched World Liberty Financial alongside real estate magnate and Trump associate Steve Witkoff.



Folkman, Herro and World Liberty Financial did not return direct messages sent to multiple social media accounts seeking comment.



World Liberty Financial’s token swap deal is currently running on a “first come first serve” basis, the message notes, although the Trump-backed platform is “prioritizing projects with the strongest technical metrics, mindshare, [and] willingness to do larger tickets than USD $10M.”



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Trump-backed World Liberty Financial courts crypto teams for token swaps

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At face value, President Trump is well on his way to giving crypto what it wants.&nbsp;



A US government strategic crypto reserve. Or maybe it’s a <a href="https://www.cnbc.com/2025/01/23/trump-signs-executive-order-on-crypto-digital-asset-stockpile.html">stockpile</a>. Is there a difference?



Anyone interested in wading into that debate is well <a href="https://x.com/search?q=stockpile%20crypto&amp;src=typed_query">covered</a> on X and so on.&nbsp;



Same goes for those keen to moralize the implications of US government agencies accumulating coins other than bitcoin — perhaps even ones backed by funds and entities controlled by appointed officials like venture capitalist <a href="https://blockworks.co/news/trump-picks-crypto-czar">David Sacks</a>.



I’m taking a different path. Let’s put aside the US strategic stockpile. It doesn’t exist, yet.



What does verifiably exist onchain is the growing crypto portfolio of <a href="https://blockworks.co/news/world-liberty-financial-kyc-starts">World Liberty Fi</a>, the DeFi project endorsed by the Trump family.&nbsp;



And because this is crypto — and it&#8217;s on Ethereum — we know exactly what it’s doing at all times, and whether it’s underwater or not.



I touched on this <a href="https://blockworks.co/news/trump-strategic-crypto-reserve">earlier this week</a>, but World Liberty Fi has bought more crypto since Trump’s inauguration on Monday.&nbsp;



The chart below treats World Liberty Fi’s stockpile as a fund. Its performance is plotted by the blue line.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXdU2hFDWlJ_IL64ZoIYeHIDpjpV6MviJskU6hom-nlRgGkxWvfOIOelF4mTSZcOShafjztA38OAuQuLPugSyGrz02X21vI8GVJLVKsUJvnC340tzO3hnX6ixGDU89MnjkddXOKB?key=r7UJwDSxvmuP7JeyAN-Z78QO" alt=""/><figcaption class="wp-element-caption">The crypto World Liberty Fi used to buy more coins came from its $300-million token <a href="https://dune.com/seoul/wlfi">sale</a>. It currently holds a combined ~$53 million in USDT and USDT.</figcaption></figure>



When the blue line goes into the red, World Liberty Fi’s accumulated portfolio is underwater. It’s otherwise ahead on its purchased crypto to date when it&#8217;s in the green area.&nbsp;



The portfolio is ahead by 4.3%, as of this morning, although there would be additional small gains related to liquid ETH staking which were not included in the analysis.



Most recently, World Liberty Fi spent $22.5 million on Thursday, on a mixture of ETH, TRX and wrapped BTC. That’s on top of the $2.65 million in TRX bought on Tuesday.



Those purchases brought World Liberty Fi total spend to $245.3 million across six different coins since it began at the end of November: the three above as well as LINK, ONDO, AAVE and ENA, a set which should integrate with the platform in some capacity in the future.



As you can see, the portfolio, now worth nearly $259 million, has spent about half the time ahead. That makes sense, considering it’s regularly accumulating crypto (although with no real stated goal for what it will be for as yet, other than for strategic purposes).



Sure, handwringing about how all this could go wrong is probably justified. Especially if World Liberty Fi’s portfolio indeed turns out to be Trump’s strategic crypto reserve.



It’s worth appreciating, however, that the very blockchain rails on which the stockpile exists make those concerns much easier to navigate. We can see what it’s doing. We can see when it buys, sells, stakes or otherwise transfers any of the coins it holds. And they will be forever trackable, at least within the current capabilities of analytics software.



The tools for everything to go right are there. We’ll just need to actually use them to make sure that it does.



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