Trump-linked World Liberty Financial has lost a key backer after its $75 million DeFi loan tied up users’ liquidity, with Justin Sun publicly breaking out and criticizing the project’s treatment of investors.
“Any action taken by the WLFI team to extract fees from users and treat the crypto community like a personal ATM is illegitimate,” Sun wrote.
I have always been an ardent supporter of President Trump and his crypto-friendly policies.
As an early adopter who invested heavily in World Liberty Financial, I did so because I believed in the vision presented to the public: a decentralized financial platform that…
— HE Justin Sun 👨🚀 🌞 (@justinsuntron) April 12, 2026
The criticism comes days after World Liberty Financial deposited 5 billion WLFI tokens as collateral on DeFi lending platform Dolomite and borrowed around $75 million in stablecoins.
The deposit still dominates Dolomite, accounting for the majority of the protocol’s roughly $794 million in total supply liquidity.
At its peak earlier this week, the USD1 pool reached 100% utilization, temporarily locking regular stablecoin depositors out of their funds. As of Sunday, the pool had eased to about 82% utilization, with about $158 million borrowed against $193 million delivered.
Dolomite co-founder Corey Caplan also serves as an advisor to World Liberty Financial, a dual role that onchain analysts have described as functionally CTO’s. To accommodate WLFI’s deposits, Dolomite raised its WLFI supply cap to 5.1 billion tokens.
“These actions have nothing to do with me. They have nothing to do with the investors who believed in the promises this project made,” Sun continued. “We strongly oppose each and every one of these actions.”
Frozen out of WLFI
Sun had helped stabilize the project early on by buying $30 million in WLFI tokens after a tepid launch raised questions about investor appetite.
Last September, WLFI froze Sun’s wallet and locked the Tron founder out of 595 million unlocked tokens, worth about $107 million at the time.
WLFI said the action was part of a broader move against 272 wallets it linked to phishing attacks and compromised support channels, insisting it “only intervenes to protect users, never to dampen normal activity.”
Sun is frames the September freeze as the project’s original sin.
“I am the first and biggest single victim,” he wrote on Sunday, “as a result of their wrongful blacklisting of my WLFI token wallet back in 2025, violating fundamental investor rights and blockchain principles of fairness.”
Sun also took aim at WLFI’s governance process, claiming that votes cited to justify the freezes “were not conducted through a fair or transparent process,” that “key information was withheld from voters,” and that “results were predetermined.”
Notably, he carefully separated his attack on WLFI’s operators from the president himself, opening his statement by affirming that he has “always been an ardent supporter of President Trump and his crypto-friendly policies” and directing his condemnation at “the bad actors at WLFI.”
WLFI co-founder Zak Folkman did not immediately respond to a request for comment sent by CoinDesk to his Telegram.
WLFi is trading at $0.079, according to CoinDesk data, down 18% over the past week.
