Svmuu News The crypto project World Liberty Financial (WLFI), co-founded by the Trump family, has conducted multiple collateralized borrowing operations through the DeFi lending protocol Dolomite, raising market concerns about insider relationships, circular financing, and liquidity risks. Data shows that WLFI has successively used its self-issued stablecoin USD1 and its platform token WLFI as collateral to borrow approximately $31.4 million worth of stablecoins in total, with some funds transferred to Coinbase Prime, suspected to be used for fiat conversion or over-the-counter trading.
Notably, Dolomite co-founder Corey Caplan also serves as an advisor to WLFI. Currently, WLFI accounts for about 55% of the protocol's deposit liquidity, significantly increasing concentration risk. Furthermore, the utilization rate of the USD1 pool on Dolomite is as high as approximately 93%, meaning ordinary depositors may not be able to withdraw funds at any time, facing the risk of locked liquidity. Simultaneously, due to the limited market depth of the WLFI token, a price drop triggering liquidation could potentially lead to a chain reaction of selling and result in bad debt risk, ultimately borne by other depositors.
On-chain data also reveals that WLFI transferred approximately 30 billion tokens (worth about $266 million) to multiple addresses in early April, with the destination still unclear. As of now, WLFI has not responded to the related transactions. (CoinDesk)