Trump-Affiliated Stablecoin Hit With HTX Delisting Amid Asset Freeze Controversy

Justin Sun has reportedly been offered a behind-the-scenes settlement by a World Liberty Financial investor, though no resolution has been announced. That unresolved tension now has a new flashpoint: Sun’s crypto exchange HTX has moved to fully delist USD1, the stablecoin tied to US President Donald Trump’s World Liberty Financial project.

A Freeze That Started It All

HTX announced on June 6 that USD1 would be removed from its platform on June 7. Users holding USD1 on the exchange will have their balances converted to USDT at a 1:1 rate, with the converted funds credited to their spot accounts.

The exchange said the decision was made to reduce potential risks, protect user assets, and maintain fair trading conditions. HTX stopped short of labeling it retaliation, but the timing left little ambiguity.

A day earlier, on June 5, HTX had already suspended several trading pairs involving WLFI tokens — including WLFI/USDT, USD1/USDT, BTC/USD1, and ETH/USD1.

The suspension followed what HTX described as a unilateral move by the WLFI project team to freeze on-chain wallet addresses linked to Huobi HTX, citing sanctions compliance reviews as justification.

Lawsuit Hangs Over The Dispute

The conflict does not exist in isolation. It is playing out against the backdrop of an active legal fight between Sun and WLFI.

Sun filed a lawsuit against the project, alleging his tokens were frozen without cause and that WLFI operates a blacklist mechanism capable of restricting or destroying user funds.

WLFI hit back with a countersuit, accusing Sun of running a coordinated defamation campaign and using social media influencers and bots to spread damaging claims about the project.

The two sides appear no closer to a resolution. A settlement offer from a major WLFI investor was extended to Sun, but he has made no public statement indicating progress on that front.

For users on the exchange, the immediate impact is straightforward: USD1 holdings will be swapped out for USDT, and the exchange has said the distribution timeline will be confirmed separately.

The broader question — whether WLFI’s invocation of sanctions compliance to freeze a counterparty’s on-chain addresses was legally grounded or tactically motivated — remains open.

Neither WLFI nor its legal representatives have issued a detailed public explanation of the freeze.

USD1 is a stablecoin issued by World Liberty Financial, a crypto project backed by Trump.

Featured image from Baltana, chart from TradingView