Key Insights:
- WLFI’s portfolio dropped $110M, with Ethereum making up 65% of the losses.
- WLFI invested $21.5M in Ethereum, Wrapped Bitcoin, and Movement on Mar. 6.
- Trump and allies control over 60% of WLFI, which raised $300M in Jan. 2025.
World Liberty Financial (WLFI) has experienced a massive $110 million drop in its cryptocurrency portfolio. Ethereum accounted for 65% of these losses, making it the primary factor in the decline. Despite this setback, WLFI continues investing heavily in digital assets, raising concerns about its strategy and financial stability.
Ethereum Leads WLFI’s Massive Portfolio Decline
WLFI invested $336 million across nine cryptocurrencies, but its portfolio has now dropped to $226 million. Data from Arkham Intelligence reveals that Ethereum led the decline, as its price dropped to around $2,000. WLFI initially purchased Ethereum at an average price of $3,240, resulting in an $80.85 million unrealized loss.
Other holdings also contributed to the decline, including stETH ($10.27M), WHITE ($5.87M), Movement ($3.5M), and Ondo ($296,000). However, Tron proved to be the most resilient, falling by only 5%. Despite the losses, WLFI remains committed to increasing its investments, signaling confidence in the long-term potential of its assets.
WLFI Expands Holdings Amid Market Uncertainty
On March 6, WLFI acquired $21.5 million worth of Ethereum, Wrapped Bitcoin, and Movement tokens. This move suggests that WLFI is doubling down on crypto investments despite recent losses. Additionally, the firm has partnered with Sui, a blockchain project founded by former Meta developers, to explore new decentralized finance opportunities.
The investment firm has also expressed interest in expanding its token reserves, fueling speculation about Trump’s influence in the cryptocurrency market. Some analysts believe WLFI’s recent acquisitions indicate an effort to strengthen its strategic token reserves, while others question whether the expansion is a response to its financial setbacks.
Trump’s Crypto Reserve and Political Implications
WLFI, founded in 2024, continues to expand and gain popularity among players in the Decentralized Finance industry. However, with Trump and his ally’s having over 60% share of the WLFI, there are concerns of potential conflict of interest. WLFI closed the token sale in January of 2025, receiving $300 million from investors despite the controversies.
Trump proposes the formation of a U.S strategic crypto reserve while its institutions are facing financial management challenges. While critics believe that Trump increasing his impact on the crypto space will create more regulation issues, proponents consider this as a shift toward a crypto-financial point.
Debanking Lawsuit and Regulatory Challenges
Trump’s financial dealings have also come under pressure from traditional banks. Recently, the Trump Organization sued Capital One for allegedly debanking 300 accounts due to political bias. Eric Trump has vowed to fight corporate debanking, citing financial discrimination against Trump-affiliated entities.
For instance, Senator Tim Scott has proposed the FIRM Act that seeks to bar banks from citing reputational risk in making regulatory decisions. When enacted, the bill would shield organisations such as WLFI from other authorities’ political bias in fiscal conduct.
The recent losses of the WLFI show that the cryptocurrency market remains unpredictable and hence, risky to invest in. Nevertheless, the firm progresses in expanding its product portfolio, which is an indication of great visions in the future. Both the investors and the regulators are keen on how WLFI manages these financial issues.
Disclaimer
This article is for informational purposes only and provides no financial, investment, or other advice. The author or any people mentioned in this article are not responsible for any financial loss that may occur from investing in or trading. Please do your research before making any financial decisions.
