World Liberty Financial (WLFI), the DeFi project partly owned by former U.S. President Donald Trump’s family, has made headlines after selling a portion of its Ethereum holdings. This move reflects the broader market struggles and raises questions about the project’s financial strategy.

Ethereum Sell-Off Highlights Mounting Losses

Blockchain analytics from Lookonchain revealed that WLFI sold 5,471 ETH for $8.01 million at an average price of $1,465 per coin. This marks a steep loss compared to the $210 million WLFI spent to acquire 67,498 ETH at an average price of $3,259.

With Ethereum prices hovering below the $1,500 mark, WLFI faces an unrealized loss of $125 million. The firm has not commented on the sales, which come amid Ethereum’s 56% year-to-date decline and broader market uncertainty.

Market Challenges Amplify Investor Concerns

Ethereum’s slump is linked to geopolitical tensions, including ongoing Trump tariff disputes, which have disrupted both traditional and crypto markets. ETH’s current price now sits below its realized price, compounding investor concerns.

WLFI’s decision to liquidate Ethereum during these turbulent conditions signals caution but also raises questions about the project’s long-term financial planning.

DWF Labs Backs WLFI Amid Market Struggles

Despite Ethereum’s downturn, WLFI received a boost from DWF Labs, which invested $25 million in 250 million WLFI tokens. This valuation represents nearly seven times the initial offering price of $0.015.

The investment highlights WLFI’s continued appeal to institutional players, even as market conditions remain volatile. Additionally, DWF Labs received 1 million USD1, WLFI’s fully collateralized stablecoin, for market-making purposes.

USD1: WLFI’s Stablecoin Gains Traction

WLFI recently proposed an airdrop of USD1 stablecoins to token holders to test its distribution model and reward early adopters ahead of a public rollout. Designed to maintain a 1:1 peg with the US dollar, USD1 has drawn attention as WLFI positions itself as a key player in the stablecoin space.

WLFI’s Ethereum sell-off underscores the challenges of navigating volatile markets, but investments like DWF Labs’ and the growing traction of USD1 signal confidence in its broader DeFi ambitions. As WLFI grapples with financial setbacks, its ability to innovate and regain investor trust remains critical to its success.