The Trump family's cryptocurrency project WLFI has been exposed for borrowing tens of millions of dollars through related agreements, raising questions about conflicts of interest

The cryptocurrency project WLFI, co-founded by the Trump family, has conducted multiple collateralized lending operations through the DeFi lending protocol Dolomite, raising market concerns about insider relationships, circular financing, and liquidity risks.

Data shows that WLFI has borrowed approximately $31.4 million in stablecoins by using its self-issued stablecoin USD 1 and platform token WLFI as collateral, and has transferred some funds to Coinbase Prime, suspected to be for fiat currency exchange or over-the-counter trading. Notably, Corey Caplan, co-founder of Dolomite, also serves as an advisor to WLFI, and currently WLFI accounts for about 55% of the deposit liquidity in the protocol, significantly increasing concentration risk.

Additionally, the utilization rate of the USD 1 pool on Dolomite is as high as approximately 93%, meaning that ordinary deposit users may not be able to withdraw funds at any time, facing the risk of liquidity lock-up. At the same time, due to the limited market depth of WLFI tokens, a price drop triggering liquidation could lead to a chain sell-off and result in bad debt risk, ultimately borne by other depositors. On-chain data also shows that WLFI transferred approximately 3 billion tokens (about $266 million) to multiple addresses in early April, with the destination still unclear. As of now, WLFI has not responded to inquiries regarding the related transactions.

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