The conflict between crypto exchange HTX and World Liberty Financial (WLFI), the Trump family-backed crypto venture, has intensified after HTX announced the delisting of the USD1 stablecoin. The move follows allegations that WLFI froze several HTX-linked blockchain addresses, restricting the circulation of assets associated with the exchange.
HTX, which is closely associated with crypto entrepreneur Justin Sun, said the freeze was imposed without sufficient communication, legal justification, or transparency. According to the exchange, the action negatively affected users and their assets, prompting HTX to remove support for the stablecoin and related trading services.
HTX Removes USD1 and Suspends Trading Services
In an official statement, HTX claimed that World Liberty Financial unilaterally froze specific on-chain addresses connected to the exchange as part of sanctions compliance reviews. The exchange argued that the restrictions were implemented without due process and violated the rights of affected users.
As a result, HTX officially delisted USD1 and suspended several trading pairs, including WLFI/USDT, USD1/USDT, BTC/USD1, and ETH/USD1. Deposit and conversion services for USD1 have also been discontinued.
The delisting became effective on Sunday, with HTX confirming that all user-held USD1 balances will be converted into Tether (USDT) at a 1:1 ratio. The exchange said additional details regarding the conversion process will be announced separately.
The dispute comes shortly after UK authorities sanctioned HTX’s former entity, Huobi Global S.A., on May 26. UK officials stated there were reasonable grounds to suspect the company had supported Russia’s government through financial services. HTX, however, rejected any connection between the sanctioned entity and the current exchange, maintaining that the designation should not impact its operations.
Legal Battle Between Justin Sun and World Liberty Financial Deepens
The latest disagreement adds another chapter to the growing legal confrontation between Justin Sun and World Liberty Financial.
In April, Sun filed a lawsuit against WLFI, alleging that the platform froze his tokens and threatened to burn them without valid justification. The lawsuit raised concerns about the project’s governance practices and treatment of token holders.
The situation escalated further in May when World Liberty Financial responded with its own defamation lawsuit against Sun. The company accused the crypto entrepreneur of making false public statements and violating token sale agreements through prohibited token transfers, short-selling activities, and the use of straw purchasers.
World Liberty Financial has not publicly confirmed whether it specifically froze HTX-linked addresses. However, the company stated on social media that it maintains risk-based sanctions compliance controls following recent sanctions updates.
The project has attracted significant attention due to its ties to U.S. President Donald Trump and his sons Donald Trump Jr., Eric Trump, and Barron Trump, who are listed as advisers to the venture.
HTX has called on World Liberty Financial to reverse the freeze and warned that it may pursue legal action to protect user interests. With lawsuits already underway and tensions continuing to rise, the dispute could have broader implications for stablecoin governance, sanctions compliance, and the relationship between centralized exchanges and blockchain-based financial projects.
