• World Liberty burned 166,667,000 WLFI tokens after 272 wallets have been compromised.
• The platform breach was believed to be attributable to a third-party safety flaw slightly than a sensible contract vulnerability.
• US senators name for investigation into alleged token gross sales to sanctioned entities.

World Liberty Monetary has introduced an emergency token burn and $22.1 million WLFI reallocation following a pre-launch phishing assault concentrating on customers’ wallets. The Trump family-backed decentralized finance platform revealed that 272 wallets have been compromised within the incident, 215 of which have been associated to phishing assaults.

The workforce carried out an emergency operate to burn roughly 166,667,000 WLFI tokens and reallocate an equal quantity to verified restoration addresses. Previous to the launch of WLFI, some consumer wallets have been compromised via phishing assaults and seed phrase publicity.

Platform exams new sensible contract logic

World Liberty Monetary mentioned it has examined new sensible contract logic to securely reallocate consumer funds and verified consumer identities via KYC checks. Quickly, customers who submit a ticket and meet the required examine could have their funds reallocated to a brand new safe pockets.

“This was not a problem with the WLFI platform or sensible contract. The attacker gained entry to consumer wallets via a third-party safety breach,” the platform mentioned. In September, the workforce froze the affected wallets and verified possession to make sure a easy transition.

This course of took a while, however in keeping with their submit, they prioritized the protection of their funds over pace. Even with points stemming from exterior vulnerabilities, the workforce prioritized consumer safety whereas assembly regulatory necessities.

Reallocation will start quickly for all wallets which have accomplished and met the required validation steps. The wallets of customers we’ve got not contacted or haven’t accomplished verification will stay frozen, however they’ll nonetheless provoke the method via our Assist Heart.

Congressional scrutiny intensifies

Though WLFI blamed the breach on third-party safety flaws slightly than platform vulnerabilities, the incident raises issues concerning the platform’s management of consumer funds. Critics argue that the transfer contradicts WLFI’s “community-governed” model, because the platform unilaterally froze and reallocated belongings with none decentralized governance proposals.

In mid-November 2025, U.S. senators Elizabeth Warren and Jack Reed requested a federal investigation into the alleged sale of WLFI tokens to sanctioned entities. Allegations embrace attainable gross sales to North Korean hacker group Lazarus, Russian sanctions-evasion instruments, and Iranian cryptocurrency exchanges.

A number of blockchain safety consultants have expressed concern that regardless of WLFI’s claims of neighborhood management, it maintains centralized management over key features, similar to the power to unilaterally freeze wallets. This centralized management additionally contradicts typical decentralized finance ideas.

Associated: https://currencyjournals.com/us-senators-allege-wlfi-links-to-lazarus-group-and-russia/