HTX to Delist USD1 and Convert to USDT for Users after WLFI Freeze Addresses

Key Insights

• This came after WLFI froze HTX-related addresses following the UK’s sanctions against the platform.
• HTX converts all users’ USD1 holdings to USDT and delists USD1.
• HTX has also suspended WLFI-related services amid user concerns about WLFI’s decentralization.

HTX exchange has converted the USD1 stablecoin in its user accounts to USDT in a drastic move that will also include the delisting of USD1. This follows World Liberty Financial, the issuer of USD1, freezing addresses linked to HTX.

The move follows the WLFI team’s decision to freeze HTX addresses over UK sanctions. According to HTX, it is converting the USD1 to USDT at a 1:1 ratio, and users will see the USDT in their balance.

HTX Slams Suspends Support for all WLFI Tokens

Beyond the conversion of USD1, HTX has also suspended support for all WLFI tokens, including USD1 and WLFI. It claimed that this decision is necessary to protect users.

With the suspension, withdrawal, and deposit of USD1, WLFI is no longer possible on HTX. All trading pairs for WLFI have also been suspended.

However, users’ accounts will continue to display their WLFI balance even though they cannot withdraw it.

The exchange has also criticized the WLFI team’s unilateral freezing of its addresses, calling it an infringement on users’ rights and interests.  WLFI’s decision to freeze HTX addresses follows the UK government’s sanctioning of the crypto exchange.

According to UK authorities, the exchange was part of the infrastructure Russia used to evade sanctions and move $1.5 billion. The UK’s Foreign, Commonwealth and Development Office listed 17 other entities apart from HTX in connection with the sanction evasion.

However, HTX claimed that the entity listed in the sanctions list, Huobi Global S.A., is not the same as the online exchange. It also claimed that the WLFI team did not reach out or inform the exchange before freezing the addresses.

WLFI Freezing Raises Questions About Decentralized Finance

While the WLFI team has yet to address the HTX incident directly, it had earlier posted on X that it “maintains risk-based sanctions compliance controls.”

In the post, the project, which labels itself as decentralized finance, said that “Transactions involving sanctioned persons, entities, or associated wallet addresses may be subject to enhanced review, rejection, restrictions, or other appropriate compliance actions.”

However, investors are questioning whether it can still be considered decentralized when users’ assets can be frozen at will. This only adds to the controversy around WLFI, which is also embroiled in a conflict with Tron founder Justin Sun.

Sun is also connected to the HTX exchange and is currently suing the Trump family-backed project for freezing his WLFI holdings.

Unsurprisingly, HTX has also removed WLFI and USD1 from its Earn Products. The exchange was one of the earliest supporters of WLFI and was the first major exchange to list the USD1 stablecoin.

The post HTX to Delist USD1 and Convert to USDT for Users after WLFI Freeze Addresses appeared first on The Market Periodical.