Why did the WLFI pre-contract drop over 65% continuously after its launch?

The WLFI (World Liberty Financial) contract has recently experienced a sharp decline, driven by multiple factors. First and foremost, a significant token unlock occurred in late August, leading to a large influx of WLFI tokens into the market in a short period, triggering selling pressure. According to AInvest news reports, this round of unlocking directly triggered a crash of over 60%, a magnitude that is extremely rare in emerging DeFi projects, indicating that the market has a weak capacity to withstand a sudden surge in short-term supply.

Combined with on-chain data, the top 10 holding addresses of WLFI collectively hold 4.63% (approximately 4.64 billion tokens), having invested over $73 million before the crash, which has resulted in substantial unrealized losses based on the latest market value. This further exacerbated market panic, as the liquidation or stampede of major holders could easily lead to retail investors following suit and selling off.

Additionally, the project has a strong correlation with U.S. politics — it has a clear “Trump concept” label. Although the official announcement of a $1.5 billion crypto treasury plan was made recently, and there were attempts to stabilize the market with a 6x seasonal strategy, confidence restoration remains limited. Expectations were extremely high during the pre-sale phase, but the performance after launch fell far short of those expectations. Some investors believe that the team has over-marketed and lacks the ability to deliver, which is also one of the important reasons for the further decline in price.

Overall, the drop in the WLFI contract is a typical case of a new project experiencing the combined effects of “unlocking + underwhelming delivery + emotional stampede.” In the short term, without strong positive news or financial support, it is expected to remain in a phase of consolidation or even continue to seek a bottom. If considering participation, it is crucial to pay close attention to subsequent team dynamics, changes in the funding pool, and the movements of large on-chain holders, while reasonably controlling positions. #ETH创历史新高