Key Takeaways
World Liberty Financial blacklisted Justin Sun’s address, freezing 540 million unlocked tokens and 2.48 billion locked tokens. On the price charts, WLFI fell to a new all-time low of $0.1616, before bouncing back to $0.1898.
World Liberty Financial [WLFI] is in the news today after it fell to a new all-time low of $0.1616, before bouncing back to $0.1898. At press time, WLFI was valued at $0.1877, following a 17.86% drop on the weekly charts. In fact, the altcoin was down 59.6% from its all-time high of $0.46 recorded just four days ago.
As expected, amid these price struggles, WLFI’s top holders turned bearish and started to dump across the board.
Justin Sun moves 55 million WLFI
According to Onchain Lens, Tron’s Founder Justin Sun jumped into the market to acquire WLFI tokens during the presale. The exec invested $75 million to acquire 3 billion tokens and received 600 million as token unlock. In doing so, he became a top holder outside Trump’s family.
Surprisingly though, after the token launch a few days ago, Justin Sun immediately turned to selling. Between 2 – 3 September, Justin Sun sold 5.289 million WLFI tokens worth $1.19 million.
On 4 September, Sun’s selling activity only accelerated, with the exec transferring 50 million WLFI worth $9.12 million to a new wallet.
World Liberty Financial blacklists Justin Sun
Following these recent transfers, the team behind World Liberty Financial sanctioned Justin Sun and blacklisted his addresses due to suspicions of market manipulation.
In doing so, they immediately froze 540 million WLFI in unlocked tokens and 2.48 billion in locked tokens. The team also alleged that an exchange, specifically HTX, used user tokens to sell and push the price of the altcoin down.
For his part, Justin Sun denied all of these allegations. On the contrary, he claimed that the transfers were minor tests with no actual market impact.
Through his X account, he added that,
“Our address only carried out a few general exchange deposit tests with very small amounts, followed by an address dispersion. No buying or selling was involved, so it could not possibly have any impact on the market.”
As expected, the move to blacklist Justin Sun’s addresses sparked some debate over decentralization of crypto and investors’ rights.
Derivatives market signals bullish recovery
Despite the unraveling scandal, demand for Futures positions remains intact. According to Coinglass, WLFI’s derivatives volume jumped by 76.4% to $7.61 billion. Similarly, the Open Interest rose by 0.64% to $769.5 million.
Source: Coinglass
Typically, when the OI and volume rise in tandem, it means greater participation and capital influx into the Futures market.
Meanwhile, the altcoin’s Long Short Ratio hiked to 1.002, hinting at higher demand for long positions. Often, higher demand for longs implies market participants are bullish and are actively betting on the price to rise.
Sellers are still active in the spot market!
Finally, according to Coinalyze, WLFI recorded a negative Buy-Sell Delta for three consecutive days.
On 5 August, WLFI saw 184.23 million in sell volumes, with the same falling from 1.66 billion the previous day. This, in comparison to 177.4 million in buy volumes.
Source: Coinalyze
As a result, the altcoin saw a negative Buy Sell Delta of -6.82 million – A clear sign of aggressive spot selling.
What’s next for WLFI?
According to AMBCrypto’s analysis, WLFI dropped to an all-time low as sellers dominated the market. At the same time, it rebounded shortly after World Liberty Financial blacklisted Justin Sun’s address.
The move to freeze Justin Sun addresses restored confidence among some investors who jumped into the Spot and Futures market. Having said that, if selling activity cools down and demand recovers, WLFI will see a sustained rebound with $0.21 as the next resistance level.
However, if instability and chaos persist, the downtrend might continue, with $0.16 acting as a critical support level.
