WLFI’s Blacklist Battles Expose Crypto’s Governance Paradox

World Liberty Financial (WLFI), a cryptocurrency project linked to U.S. President Donald Trump, has drawn criticism from a prominent blockchain developer who accused the project of stealing his funds. Bruno Skvorc, a Polygon Developer Relations representative and Ethereum 2.0 contributor, posted on X that WLFI’s compliance team labeled his wallet as “high risk” due to prior blockchain exposure and refused to unlock his tokens. Skvorc claimed that the refusal left him unable to access or transfer his assets, effectively rendering them inaccessible to him. “They stole my money,” he stated in the post, adding that the project’s ties to Trump’s family made it “the new age mafia” with no recourse available for investors [4].

The controversy comes amid broader concerns over the project’s governance and token management. On September 4, WLFI blacklisted Tron founder Justin Sun’s address, preventing him from transferring 595 million WLFI tokens worth approximately $107 million. Sun denied any plans to sell his tokens and accused the team of violating the principles of blockchain by freezing investor assets. He argued that the actions undermined trust and transparency, core tenets of the crypto industry [5].

The blacklisting of Sun’s address followed a $9 million transaction linked to his wallet, which WLFI’s team cited as justification for the move. Sun, however, maintained that the transaction involved only small-scale deposit tests and did not involve any selling or market manipulation. His complaint highlighted broader concerns about the use of automated compliance tools, which critics say often flag legitimate addresses for trivial or irrelevant reasons [4].

The WLFI token has experienced significant volatility since its public trading debut on September 1. The token reached a peak of $0.331 on its first day but has since dropped to around $0.23, a decline of nearly 31%. In an effort to stabilize the price, World Liberty Financial announced a token burn of 47 million WLFI on September 2, reducing the total supply to just over 99.95 billion tokens. The burn aimed to increase scarcity and potentially support the token’s value by reducing the circulating supply [3].

However, analysts remain skeptical about the effectiveness of such measures in the long term. Kevin Rusher, founder of RAAC, a real-world asset borrowing and lending ecosystem, noted that while the token launch generated hype, it also exposed the speculative nature of celebrity-backed crypto projects. He argued that institutional adoption, rather than celebrity endorsements or short-term market frenzies, would determine the future of the industry [3].

WLFI is a governance token, granting holders the right to vote on key project decisions, including policies for USD1, a stablecoin pegged to the U.S. dollar. The Trump family and other insiders hold more than 20% of WLFI tokens, raising questions about potential influence over governance decisions. World Liberty Financial’s terms stipulate that no single wallet can hold more than 5% of governance power, an attempt to prevent any one investor from dominating the decision-making process [1].

The project has also faced scrutiny for its connections to Trump’s other crypto ventures, including the $TRUMP and $Melania meme coins. Critics argue that these projects blur the lines between political influence and financial investment, potentially creating conflicts of interest. The administration has consistently denied any such concerns, with White House spokesperson Karoline Leavitt calling accusations of conflict “irresponsible” [1].

Source: [1] New crypto token boosts Trump family's wealth by $5 billion (https://www.cbsnews.com/news/trump-wlfi-world-liberty-financial-crypto-wealth/) [2] Trump family crypto project breaks with key billionaire partner (https://www.axios.com/2025/09/05/trump-justin-sun-world-liberty-financial) [3] World Liberty Burns 47M Tokens as WLFI Price Slides (https://cointelegraph.com/news/wlfi-token-burn-price-drop-world-liberty-financial) [4] Crypto dev claims Trump-linked WLFI 'stole' his money (https://cointelegraph.com/news/developer-trump-wlfi-stealing-tokens) [5] World Liberty Financial Blacklists Justin Sun's Address ... (https://www.coindesk.com/tech/2025/09/04/world-liberty-financial-blacklists-justin-sun-s-address-with-usd107m-wlfi)