WLFI vs Justin Sun just went nuclear.
“See you in court.”
Sun claims WLFI hid a blacklist backdoor in its contract.
Result? 595M tokens frozen. ~$107M locked. No warning. No explanation.
7 months later, still frozen.
While stuck, WLFI dumped ~74%.
He couldn’t sell. Couldn’t hedge. Just watched losses pile up.
Then this week 👇
WLFI used its own token as collateral on Dolomite, borrowed $75M, moved $40M+ to Coinbase Prime.
Problem? Insider connection.
Meanwhile, users couldn’t withdraw. Pool maxed out.
WLFI says “no liquidation risk” and can add more collateral.
Market didn’t buy it. Price dropped again.
Now Sun goes public. Calls governance fake. Says users were treated like liquidity.
WLFI fires back: “Does anyone still believe him?”
Big question remains:
If your wallet can be frozen anytime… is this really DeFi? 👀
