Did Trump Crypto Project WLFI suffer a security breach?

Table of Contents

World Liberty Financial (WLFI), a crypto project associated with US President Donald Trump and the Trump family, including Eric Trump, Donald Trump Jr. and Barron Trump, faced a security breach in September and recently went public with the fact.

Wednesday, November 19, 2025

Official World Liberty Financial

4.82%

announced in a post on X that it had frozen some user wallets in September. According to a statement released, WLFI froze the wallet after a “third-party security lapse” exposed users’ secret recovery phrases, leading to phishing attacks.

Importantly, the statement clarifies that a “relatively small subset” of wallets were compromised by an external vulnerability and that WLFI’s systems and smart contracts are functioning properly.

1/ Prior to the launch of WLFI, a relatively small subset of user wallets were compromised through phishing attacks and the publication of seed phrases.
Since then, we have been testing new smart contract logic to securely reallocate user funds and verify user identities through KYC checks.
Soon, users will…
— WLFI (@worldlibertyfi) November 19, 2025

Meanwhile, crypto-native companies are moving funds from affected wallets to new, secure wallets. However, only users who pass the security check will get their funds back.

3/ Users who reported a breach were asked to re-complete KYC to verify their identity before being provided with a new wallet.
In parallel, we built and tested new smart contract logic to handle bulk reallocations to ensure protection for WLFI users.
— WLFI (@worldlibertyfi) November 19, 2025

The WLFI team also noted that it is testing new smart contract features that will help better protect users and maintain regulatory compliance during the process.

For now, WLFI has not disclosed the number of wallets or individuals affected or the amount involved. Additionally, compromised wallets will remain frozen while the team verifies ownership.

Once the check is complete, the transfer will resume again.

Explore: The Next 1000x Crypto – Introducing 10+ Crypto Tokens That Could Hit 1000x This Year

Senators call for investigation of WLFI: Tokens find their way to sanctioned companies

The announcement of this security breach comes just days after U.S. Senators Elizabeth Warren and Jack Reed asked the U.S. Department of Justice (DOJ) and Treasury Department to investigate claims that WLFI tokens were sold to sanctioned individuals or entities.

🚨Now: U.S. senators Elizabeth Warren and Jack Reed are calling for a federal investigation into World Liberty Financial, a cryptocurrency project linked to Trump.
Their letter asks the Department of Justice and the Treasury Department to investigate the following allegations: $WLFI The token sale was connected to a wallet associated with North Korea. pic.twitter.com/P9mx081Qb5
— Nexus (@Nexus_Epoch) November 19, 2025

Their request was based on research by the watchdog group Accountable.US, which allegedly linked WLFI transactions to addresses associated with North Korea’s Lazarus Group, a Russian tool aimed at evading sanctions, and an Iranian cryptocurrency exchange.

In an update on Wednesday, WLFI ignored the allegations.

Meanwhile, several blockchain security experts criticized Accountable.US’ report. Taylor Monahan, head of security at MetaMask, and Nick Bax, founder of Ump.eth, claimed that the analytics incorrectly read token movements and incorrectly linked users to Lazarus Group.

Suspicions of abuse regarding cryptocurrencies have once again surfaced. Today, addresses associated with North Korea have invested in WLFI.
Since I am also researching North Korean cryptocurrencies, I decided to take a look at their findings.
They are malicious and an innocent user lost $100,000 because of them 🧵 pic.twitter.com/yJKEH04nup
— Nick Bax (@bax1337) November 18, 2025

Bax explained that the report’s conclusions were based on “funky shitcoin token transfers” and warned that innocent users could be falsely reported. He also pointed out that an analyst known as Schrider may have had about $95,000 worth of WLFI tokens frozen due to what he called a “false positive.”

Explore: 20+ cryptocurrencies that will explode in 2025

WLFI breach sparks debate: Is it secure?

WLFI is transferring funds to a new secure wallet, but claims it will only do so to those who can prove their identity and ownership. This includes creating new wallets, transferring assets using updated smart contract code, and verifying user details through KYC (Know Your Customer) protocols.

At this point, WLFI appears to be addressing two issues at once. First, how secure is WLFI? And how will it work at scale, especially after the September security breach?

World Liberty Fi performed emergency functions recording 166.667 million $WLFI ($22.14 million) from compromised addresses to recovery addresses.
Functions designed for two scenarios:
Investor loses access to wallet before vesting or malicious account obtains WLFI via exploit pic.twitter.com/VSUDWhDPCR
— Emmett Gallic (@emmettgallic) November 19, 2025

Second, prove that the WLFI token was not ultimately passed to the authorized entity. Failure to do so may result in a deeper investigation by the Department of Justice, Treasury, or OFAC.

Token’s close ties to the Trump family have already raised eyebrows about potential conflicts of interest. Following the receipt of allegations and violations by Accountable.US, regulators are monitoring the WLFI token even more closely.

Explore: 9+ Best High-Risk, High-Return Cryptocurrencies to Buy in 2025

Important points

WLFI froze compromised wallets after September breach due to third-party security flaw
Sens. Elizabeth Warren and Jack Reed have called for a federal investigation into WLFI’s alleged ties to licensed crypto addresses.
Industry experts disputed the watchdog’s report, citing the risk of misattribution and flaws in the blockchain analysis.