Price Manipulation Allegations Lead WLFI to Freeze 272 Wallets, Stirring Community Backlash

Suspicion of Price Manipulation Rocks WLFI and TRX Markets

Ryan Fang, Head of Growth at World Liberty Financial (WLFI), has raised alarms over possible price manipulation by large token holders, citing community reports on September 7, 2025.

While Fang stressed that no hard evidence currently confirms wrongdoing, he warned,

“We believe that some very large token holders may have manipulated the price, essentially to lock in profits… We emphasize that we are still exploring and discovering this. But the possibility … is certain … Some community members … believe that the scenario … may have occurred. That would be a huge systemic manipulation. We will investigate this, and it may have caused huge losses in the past few days. But again, there is no hard evidence for this information at present, but we believe that something has indeed occurred in the past few days.”

This revelation comes amid growing concerns over the vulnerabilities of centralised exchanges and heightened volatility in the WLFI and TRX markets.

Following Fang’s statements, WLFI froze several wallets linked to suspicious activity, intensifying scrutiny over token security and transparency.

272 Wallets Blacklisted Amid Investigation

WLFI confirmed that 272 wallets were blacklisted in response to reports of phishing attacks, confirmed compromises, and high-risk activity.

Of these, 215 addresses were targeted by hackers attempting to drain funds, while 50 wallets were blocked after users requested intervention.

Five additional wallets remain under review for exposure to potentially harmful activity, and one wallet is being investigated for suspected misappropriation of community funds.

The company stressed that routine trading or holding of tokens was never affected, and measures focused solely on protecting users and preventing malicious activity.

WLFI’s public update urged affected holders to contact official support channels to recover funds safely and avoid unverified links or messages.

High-Profile Backlash As Justin Sun’s Wallet Freezes

The situation escalated when Justin Sun claimed that his WLFI allocation was frozen following a $9 million transfer flagged on-chain.

Sun labelled the freeze as “unreasonable,” insisting his activity consisted only of “generic exchange deposit tests” and “address dispersion,” not sales.

Sun had previously invested $30 million in WLFI in 2024, later increasing his stake to $75 million, drawing attention to the stakes involved.

WLFI clarified that the blacklisting was preventive, stating,

“We do not seek to blacklist anyone. We respond when alerted to malicious or high-risk activity that could harm community members. User safety > everything.”

Security Experts Weigh In On Compliance Measures

WLFI’s pseudonymous security advisor, Ogle, who has helped recover over $400 million from previous blockchain hacks, outlined the rationale behind tougher wallet screenings.

He said,

“There are certain people who use wallets that are sending a bunch of money through Tornado Cash, or interacting with sanctioned [entities]. You can’t expect a project associated with the President of the United States of America is going to be doing that.”

Ogle clarified that he was not involved in the blacklisting process itself.

Meanwhile, critics including developer Bruno Skvorc claimed that compliance tools mislabel addresses as “high risk,” citing past Tornado Cash interactions and links to sanctioned platforms.

On-chain investigator ZachXBT warned that automated compliance systems often produce false positives due to complex transaction histories.

Community Response Remains Tense

The WLFI community has been vocal on platforms like Discord and Telegram, calling for transparency and clarity.

While the investigation continues, the situation highlights the tension between centralised compliance measures and the ideals of decentralised finance.

WLFI maintains that protecting users and mitigating potential threats is the priority, even as debates over fairness and control continue to surface.