HTX Escalates Dispute With WLFI After Address Freeze

4 hours ago 13

HTX has suspended trading of WLFI and USD1 assets after the World Liberty Financial team froze user tokens on HTX-linked addresses, escalating tensions over issuer control in crypto.

The exchange acted swiftly on June 5, 2026, at 13:00 UTC to protect users amid the unilateral freeze.

HTX Suspends WLFI and USD1 Trading After Asset Freeze

The WLFI project team restricted on-chain circulation of specific WLFI tokens in HTX-related addresses, citing an ongoing UK sanctions compliance review.

HTX stated these are not assets of any sanctioned entity or the exchange itself, they belong to individual users who legally purchased them.

“These are assets legally purchased and owned by individual users… To date, we have received no clear explanation regarding the legal basis, scope, standards, or resolution process behind this action,” HTX spokesperson stated.

HTX’s Decisive Response

To safeguard user assets, preserve market fairness, and reduce systemic risks, HTX immediately suspended these trading pairs:

WLFI/USDT
USD1/USDT
BTC/USD1
ETH/USD1

The exchange suspended USD1 deposits and withdrawals. All user USD1 holdings were automatically converted to USDT at a strict 1:1 ratio.

WLFI tokens remain safe on-chain, with withdrawals expected to resume once the freeze is lifted. HTX has formally requested WLFI to restore access.

Root Cause and Broader Context

The freeze traces directly to UK sanctions designating Huobi Global S.A. — the Panama-registered entity tied to HTX — on May 26, 2026, under Russia (Sanctions) (EU Exit) Regulations 2019.

The UK cited suspected facilitation of over $1.5 billion in flows supporting Russian sanctions evasion.

WLFI maintains risk-based sanctions compliance controls and has publicly reminded users of potential restrictions on associated addresses.

Its token smart contract includes an admin-controlled blacklist/freeze function, a capability previously exercised in 2025 disputes with large holders, including those linked to Justin Sun.

HTX was an early supporter of World Liberty Financial and the first major exchange to list USD1 on May 6, 2025. USD1 is a USD-pegged stablecoin with collateral held by BitGo Trust.