World Liberty Financial pledged billions of its own WLFI tokens on Dolomite — a protocol co-founded by a WLFI advisor — to borrow $75 million in stablecoins, locking out ordinary depositors in the process.
Posted April 10, 2026 at 6:52 am EST.
World Liberty Financial (WLFI), the crypto venture co-founded by the Trump family, pledged 5 billion WLFI tokens on the Dolomite DeFi lending protocol and borrowed approximately $75 million in stablecoins, CoinDesk reports. More than $40 million of those proceeds moved directly to Coinbase Prime, typically used for institutional OTC conversion.
On-chain data shows WLFI’s official treasury multisig routed roughly 3 billion WLFI tokens through an intermediary wallet before depositing the full amount into Dolomite as collateral, CoinDesk said. The treasury separately deposited roughly 2 billion WLFI directly. In total, WLFI borrowed 65.4 million USD1 and 10.3 million USDC, though $15 million was subsequently repaid.
The structure raises immediate conflict-of-interest questions. Dolomite co-founder Corey Caplan also serves as an advisor to WLFI. In traditional finance, a related-party transaction of this scale would typically require disclosure and independent board approval. In DeFi, such guardrails are largely absent.
This story is an excerpt from the Unchained Daily newsletter.
Subscribe here to get these updates in your email for free
The maneuver pushed the Dolomite USD1 pool utilization rate to roughly 93%, making timely withdrawals difficult for ordinary depositors. Because WLFI has limited market depth, a price drop triggering liquidation could cause forced selling that rapidly erodes collateral value — leaving depositors exposed to bad debt the protocol cannot absorb.
WLFI dropped nearly 10% to a record low following the disclosures. The episode arrives alongside separate scrutiny: an investigation found that WLFI had integrated its USD1 stablecoin with a Southeast Asian blockchain project linked to a founder sanctioned by U.S. and U.K. authorities over alleged involvement in large-scale online fraud.
