World Liberty Financial Burns $23 Million in Hacked Tokens to Protect Users

World Liberty Financial (WLFI), the Trump family-backed DeFi platform, has burned $23 million worth of compromised tokens as part of an emergency response to a phishing incident affecting a small number of pre-launch wallets. The burn, executed via a dedicated smart contract on November 19, 2025, permanently removes the stolen assets from circulation and enables the reallocation of legitimate users’ funds to secure new addresses.

What Happened and How WLFI Responded

The breach involved a limited subset of wallets created before the platform’s official launch and was caused by third-party phishing attacks, not vulnerabilities in WLFI’s core infrastructure. Upon detection, the team took immediate action:

• Froze affected wallets to prevent further unauthorized transfers.
• Required impacted users to resubmit KYC verification.
• Delayed reallocations to conduct thorough testing and ensure full regulatory compliance.

Once verification was complete, WLFI deployed an emergency smart contract to burn the stolen tokens and transfer equivalent holdings to fresh, secure addresses for verified users. Unverified accounts remain frozen pending completion of the KYC process.

• Amount Burned: $23 million in WLFI tokens.
• Cause: External phishing; no platform exploit.
• User Impact: Verified holders now receiving funds in new wallets; unverified remain paused.

Emphasis on Security and User Protection

WLFI leadership stated the measures were designed to “safeguard every legitimate participant” while maintaining the highest standards of transparency and compliance. The proactive burn and reallocation process demonstrates a commitment to user protection amid rising phishing threats across the crypto industry, where external social engineering remains a leading cause of losses.

The team also reiterated that the incident was isolated to pre-launch wallets and did not affect the platform’s mainnet operations or broader treasury.

Current Status

Reallocations are actively underway for verified users, with the process expected to complete within the coming days. Users with frozen wallets are encouraged to complete KYC resubmission promptly through official channels to regain access.

In summary, World Liberty Financial’s swift burn of $23 million in hacked tokens and ongoing reallocation to secure addresses reflect a decisive, user-first response to a phishing incident, reinforcing the platform’s focus on safety and compliance in the evolving DeFi landscape.