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World Liberty Financial ($WLFI) announced that it is reallocating funds and confirming user identities after discovering that several wallets were compromised through external security failures.
The update comes at a sensitive moment, as U.S. lawmakers urge federal agencies to investigate alleged $WLFI token activity linked to sanctioned regions.
Wallet Breaches Trigger Internal Review
In an X post on Thursday, $WLFI disclosed that a limited number of wallets had been compromised ahead of the platform launch. The company said these incidents were the result of either phishing attempts or exposed seed phrases. Importantly, it emphasized that the vulnerabilities stemmed from third-party security lapses, not from $WLFI’s own platform or smart contracts.
To mitigate the impact, $WLFI froze the affected wallets in September. Subsequently, the team verified ownership to prepare safe transfers for users who completed the required checks. This process aimed to rebuild trust while protecting the remaining assets, according to $WLFI.
In addition, as part of the recovery effort, the company is now testing new smart contract logic. $WLFI says the updated framework is to prevent similar incidents and create a more resilient environment for affected users.
Nevertheless, despite the steps taken, the project has not disclosed how many accounts were impacted or how much crypto may be at risk.
Senators Seek Clarity on Possible Sanctions Breaches
The wallet update comes as $WLFI faces congressional attention. Earlier this week, Sen. Elizabeth Warren and Sen. Jack Reed asked the DOJ and Treasury Department to examine alleged $WLFI token sales to sanctioned entities. According to CNBC, their request referenced a report from Accountable.US.
