Crypto Developer Accuses Trump-Linked WLFI of Withholding Tokens
Bruno Skvorc, a prominent blockchain developer affiliated with Polygon, has publicly accused World Liberty Financial (WLFI), a cryptocurrency project associated with former US President Donald Trump, of freezing and seizing his tokens without justification. Skvorc described the situation as “the new age mafia,” emphasizing the lack of recourse available to investors.
In a recent post on X (formerly Twitter), Skvorc shared correspondence from WLFI’s compliance team indicating that his wallet address was flagged as “high risk” due to its blockchain history, resulting in the refusal to unlock his tokens. He stated, “TLDR is, they stole my money. And because it’s the @POTUS family, I can’t do anything about it.”
Skvorc further explained that he was among six investors subjected to complete token lockups from the project’s inception. He clarified that accepting funds from his address was not considered risky, but releasing owed tokens back to it was deemed high risk by WLFI.
Questions Raised Over Compliance Tools
This incident has drawn criticism toward the automated compliance tools used by projects like WLFI to assess wallet risk. Onchain investigator ZachXBT noted that such systems often flag addresses incorrectly due to indirect associations with decentralized finance (DeFi) contracts or exchanges.
“I helped a team manually review addresses for a presale because popular compliance tools labeled them high risk due to unrelated activity several hops away,” ZachXBT explained, underscoring the inherent flaws in current risk assessment algorithms.
In Skvorc’s case, the compliance flags reportedly stemmed from a past transaction involving the crypto mixer Tornado Cash, indirect links to sanctioned entities such as Garantex and Netex24, and interactions with a blacklisted dashboard.
Other High-Profile Token Freezes
The controversy extends beyond Skvorc. Tron founder Justin Sun revealed that his WLFI token allocation was also frozen following a blockchain alert on a $9 million transaction. Sun criticized the blacklisting as “unreasonable,” arguing it violates blockchain principles by undermining the inviolability of tokens.
Sun urged World Liberty Financial to reconsider the freeze, emphasizing that tokens should remain “sacred and inviolable” within decentralized ecosystems.
Implications for Crypto Investors
This episode highlights the challenges and risks investors face when compliance protocols intersect with decentralized finance. The use of automated risk flags, while intended to prevent illicit activities, can inadvertently restrict legitimate token holders, raising concerns about transparency and investor protections in emerging crypto projects.
FinOracleAI — Market View
The allegations against WLFI and the freezing of tokens belonging to notable figures like Bruno Skvorc and Justin Sun are likely to generate negative sentiment in the short term. The controversy exposes vulnerabilities in compliance mechanisms that may impact investor confidence, particularly in projects linked to high-profile political figures.
Risks include potential regulatory scrutiny and reputational damage for WLFI, which could lead to decreased liquidity and trading activity. Market participants should monitor WLFI’s responses and any regulatory developments closely, as these will influence token valuation and broader trust in similar projects.
Impact: negative
