Hello, it seems you are inquiring about the reasons for the decline of the WLFI currency associated with the Trump and family project. This decline has several interconnected reasons, which I will explain to you based on the latest available information as of today (September 5, 2025).
📉 The main reasons for the decline in WLFI price
1. The blacklisting of major investor Justin Sun and the freezing of his stake
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- Developers of the World Liberty Financial project froze the wallet of prominent investor Justin Sun, which contains 2.94 billion tokens (approximately 540 million unlocked and 2.4 billion locked), a massive stake that was worth about $75 million at the time of investment.
- Blockchain data showed significant transfers from Sun's accounts to exchanges just before the freeze (valued at around $9 million), raising suspicions of insider selling or price manipulation, despite his claims that they were "small deposit tests."
- This sudden freeze caused a shock to investor confidence and led to a sharp sell-off.
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2. Intense selling by early and insider investors
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- Immediately after the launch, many investors who bought the token in the presale stage at a very low price (around $0.015) sold large quantities to realize quick profits[haptic 3].
- Massive deposits were observed on the Binance exchange from addresses linked to these early investors, including individual deposits estimated in the tens of millions of dollars.
- This massive influx of supply in the market outpaced demand and caused immense selling pressure.
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3. Concerns regarding governance and centralization
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- The selective freeze of Justin Sun's wallet (a prominent figure in the field) sparked sharp criticism regarding the project's decentralization and the extent of developers' control over the assets.
- This incident highlighted the risks of the excessive influence of large investors (whales) on the liquidity and price of the currency, undermining the confidence of small investors.
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4. Ineffective price support measures (Token burning)
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- In an attempt to halt the decline, the team announced the burning of 47 million tokens from the circulating supply.
- However, this amount represented only 0.19% of the circulating supply, which analysts described as a very limited and insufficient impact to offset the massive selling pressure.
- The action did not achieve the desired outcome, and the price continued to drop, increasing investors' frustration.
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5. Poor performance of other assets associated with Trump and the general context
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- The historical poor performance of assets associated with Trump has affected investors' outlook. For example, the official TRUMP Meme coin dropped from around $49 in January 2025 to about $8 currently.
- Shares of companies linked to the project, such as ALT5 Sigma Corp (the parent company of WLFI) and **American Bitcoin Corp** (in which Eric Trump is involved), also experienced sharp declines, exceeding 50% at times over the past week.
- Ongoing regulatory concerns: There are criticisms from legislators and experts regarding potential conflicts of interest, as Trump's supportive policies for cryptocurrencies may directly benefit his family's business investments.
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6. General market pressures and concerns over institutional adoption
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- Comments from industry experts have emerged questioning the market's maturity, as the buzz around the launch of WLFI and the trading intensity caused a sharp increase in transaction processing fees on the Ethereum network, indicating that the infrastructure may not yet be ready for widespread mainstream adoption.
- There are doubts about the long-term economic viability of the project and the tangible benefits for WLFI token holders, especially regarding its core product, the USD1 stablecoin.
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💡 Potential Future Predictions
· In the short term, the decline may continue if the selling pressure from whales and early investors persists, with potential technical targets for a drop around $0.086.
· The currency may experience short-term bounce backs (such as the so-called "dead cat bounce"), but these may not last long if not accompanied by substantive improvements in confidence and governance.
· The long-term success of the project hinges on the team's ability to address trust issues, demonstrate the economic viability of its products (such as the USD1 stablecoin), and navigate potential regulatory challenges.
🎯 Summary
The decline of WLFI is the result of a dangerous mix of internal and external factors: suspicious selling practices by insiders and large investors, a crisis of confidence in the project's governance and transparency, ineffective support measures, and broader market and regulatory pressures linked to the Trump family's image.
To delve deeper, you can refer to news coverage from Cointelegraph and Arabium.$$
