Key Highlights
- World Liberty Financial has officially disclosed that a relatively small subset of user wallets was compromised
- However, the platform confirmed that the security breach was not due to a problem in World Liberty Financial’s own platform or smart contracts
- After freezing the affected wallets in September, the WLFI team revealed that reallocation will start soon
On November 19, World Liberty Financial (WLFI), a DeFi platform backed by the Trump family, shared a public statement on X (formerly Twitter) about a latest security breach.
1/ Prior to WLFI’s launch, a relatively small subset of user wallets were compromised via phishing attacks or exposed seed phrases.
Since then, we’ve tested new smart contract logic to safely reallocate user funds and verified users’ identity via KYC checks.
Shortly, users who…
— WLFI (@worldlibertyfi) November 19, 2025
In a thread, the company revealed that “a small subset of user wallets” were compromised before its official token, WLFI’s launch. This post has sparked a series of discussions in the crypto community.
However, WLFI clarified that the issue was not with its own systems. Instead, it revealed that users fell for phishing attacks or had their private seed phrases exposed by other means.
However, the platform claimed that it is taking important steps to fix the problem. It revealed that it had tested new smart contract code to safely move user funds. It also said that it verified user identities again through Know Your Customer (KYC) checks.
In the tweet, the platform mentioned that users who had submitted help tickets and passed the verification steps would soon have their funds moved to new, secure wallets.
What Went Wrong for World Liberty Financial Users?
According to the post on X, World Liberty Financial has refuted allegations that this was a failure of the WLFI platform or its smart contracts.
The attacker gained access to user wallets through security failures that happened outside of World Liberty Financial’s control. The company revealed that it had frozen the affected wallets to prevent further losses and to give the team time to verify the legitimate owners of the wallets.
In order to verify, users who reported a compromised wallet were asked to complete KYC checks a second time. This was to confirm their identity before the company would provide them with a new wallet.
“Users who reported compromise were asked to re-complete KYC to confirm identity before providing new wallets. In parallel, we built and tested new smart contract logic to handle bulk reallocations, ensuring WLFI users remain protected,” stated in the post.
In the thread on X, WLFI announced that the reallocation of funds would begin shortly for all affected wallets that completed the required verification steps.
On the other side, users who had not yet reported an issue or finished verification, their wallets will remain frozen.
Senators Demand for Investigation into the Trump Family’s Crypto Venture
On November 18, two Democratic Senators, Elizabeth Warren and Jack Reed, sent a letter to Treasury Secretary Scott Bessent and Attorney General Pam Bondi, in which they raised concerns about the platform’s token sales.
“We write to inquire about actions that the Departments of the Treasury and Justice are taking to investigate national security risks posed by the U.S. crypto platform, World Liberty Financial, Inc. (WLF), in light of recent reports that it sold tokens to buyers that conducted business with North Korean state-sponsored hackers, sanctioned Russian money-laundering entities, and other illicit actors,” written in a letter.
The letter claimed that WLFI sold tokens to traders whose digital wallets had previously interacted with addresses linked to North Korea’s Lazarus group. This group is a state-sponsored hacking group known for stealing billions in cryptocurrency.
The allegations also include sales to wallets connected to a Russian stablecoin designed to evade sanctions and to an Iranian exchange.
Since its inception, WLFI has become a hotbed for controversies. With the serious allegations, it became the center of a political battleground. Some Democratic senators framed this as a major national security risk. They argued that by selling tokens to these entities, WLFI gave American adversaries a seat at the table. They raised concerns that foreign actors could use this power to influence a U.S.-based financial protocol.
