Justin Sun’s Frozen WLFI Holdings Lose $60M After Blacklist

• Justin Sun’s frozen WLFI position has lost about $60 million since September.
• World Liberty Financial blacklisted Sun’s wallet after a $9 million token transfer.
• With roughly 545 million WLFI locked, Sun has been unable to sell or hedge.

Justin Sun’s locked WLFI holdings have lost roughly $60 million in value since September, as his wallet remains blacklisted by World Liberty Financial. The decline follows WLFI’s sharp price drop while Sun’s tokens remain frozen and inaccessible.

The freeze was a result of WLFI’s decision to block hundreds of wallets after a reported phishing incident and other high-risk activity. One of the frozen addresses was linked to Sun, who had moved about $9 million worth of WLFI between wallets shortly after trading began.

WLFI said the action was part of a broad security response and not targeted at any individual. Sun rejected that explanation and called the freeze unreasonable.

Security Action or Intentional?

WLFI disclosed that 272 wallets were frozen in total. The project said most were tied to an active phishing attack or user-reported compromises, while a small number were flagged for high-risk exposure.

One wallet was flagged for suspected misappropriation of other holders’ funds, which on-chain analysis later linked to Sun.

Sun denied wrongdoing and said he had supported the project with long-term intent. He pointed to his $75 million WLFI investment and broader backing of Trump-linked crypto projects as evidence that he had no reason to misuse funds.

WLFI maintained that user protection took priority and said the blacklist would remain until internal reviews were complete. No timeline for unlocking funds has been provided.

Token Price Collapse Locks in Losses

Since September, WLFI has fallen more than 40% from its early trading highs. The price now sits near $0.1318.

On-chain data shows Sun currently holds about 545 million WLFI tokens, valued near $71 million at current prices. Because the tokens are frozen, Sun has been unable to sell, hedge, or reposition during the drawdown. 

WLFI markets itself as a governance-driven system, yet retains the ability to freeze wallets and restrict access to assets. The move raises questions about transparency, decentralization, and investor trust.

Three months after the initial freeze, the situation remains unresolved. Sun is still blacklisted, his WLFI remains locked, and the value continues to move without him.

Related: US Senators Demand DOJ Investigation Into Trump-Linked WLFI for Alleged Sanctions Violations