The market is concerned about World Liberty Financial, the Trump-backed decentralized finance project. A lot of its holdings in Ethereum were sold at a massive loss. These sales were taking place in a broader crypto downturn. Since the early half of 2025, Ethereum has corrected by more than 57 percent.
Key-Takeaways:
- A source reported that World Liberty Financial holds 5,471 ETH, resulting in an unrealized loss totaling $125 million, rasiing concerns about the company’s strategy.
- World Liberty Financial has nevertheless launched USD1, a new stablecoin, as the market continues to dip and awaits support from Ethereum at 1,200.
The Massive Ethereum Selloff
On April 9, 2025, World Liberty Financial supposedly bought 5,471 ETH for about $8.01 million, or roughly $1,465 a token. Because it coincided with a bearish market and was for such a large scale, the transaction has gained attention.
The sale will lead to a big loss in this project’s original investment strategy. Arkham firm for blockchain analytics, said that a wallet that may be associated with World Liberty Financial made the transaction just before publication of related reports.
These implications are very large in terms of financial implications for World Liberty Financial. It is worth noting that the DeFi project previously bought 67,498 ETH with the average price being $3,259 for a total investment of around $210 million.
However, due to Ethereum’s current price being far below that purchase price, the project is sitting on a huge unrealized loss. World Liberty Financial’s ETH holdings are down about $125 million, making estimates, according to its current position.
With such a 55% loss on the sold tokens, World Liberty Financial’s investment strategy and future plans are called into question. Whether strategic portfolio rebalancing or because of fears of further market deterioration, the decision to sell at such a large discount suggests an initial slim opportunity.
Market Impact and Whale Movements
Alongside other high Ethereum market activity comes the World Liberty Financial sale. An investor in whale who held 10,000 ETH for more than 900 days and sold it for $15.71 million recently liquidated its position.
Such a sale would yield the investor $2.75 million in profit. Although they bought Ethereum at an average price of $1,295 in late 2022, the investor missed the chance to sell while its price peaked above $4,000.
Another 220,000 ETH position was liquidated for another crypto whale who had to inject over $14.5 million worth of 10,000 ETH. Unfortunately for an investor, they lost 67,570 ETH (about $106 million) when their position was liquidated on DeFi lending platform.
This has only exacerbated concerns in the growing market. Some analysts read World Liberty Financial’s large-scale sale as a signal of further selling pressure in the market.
However, nearly all the major tokens have suffered due to the broader cryptocurrency downturn. In February, Bitcoin crashed some 20% and altcoins have lost more: Solana has dropped by over 45%, Dogecoin over 140%.
World Liberty Financial’s Business Expansion
The heavy losses on Ethereum have not caused World Liberty Financial to change their business strategy. USD1, a stablecoin of which the company says it has one US dollar per US dollar of backing in the form of cash, U.S. Treasuries and other such resources, the company launched on March 25.
USD1 is a more transparent and regulation friendly version of existing stablecoins marketed by World Liberty Financial. This is a move from the project to stay active and relevant in the evolving crypto space.
A variant of stablecoin has already been deployed on Ethereum and BNB Chain networks and it plans to deploy it on the additional blockchain networks. At World Liberty Financial, we maintain reserves of USD1, we verify it through external auditors and are secured by BitGo for the safety of all our institutional investors.
World Liberty Financial diversifying into stablecoins could also be a move to siphon away losses from its Ethereum investments. World Liberty Financial also has some notable investors, including Tron founder Justin Sun who provided $75 million and thereafter became an advisor to World Liberty Financial.
Analysts stated that Ethereum would be critical below $1,200 as support. Prices could fall a drop below this threshold to deeper declines, potentially back to the $1,000 level.
Crypto analyst Ali Martinez thinks that something could happen at this level to stabilize ETH. However, another analyst by the name of Venturefounder concludes that Ethereum is probably at its cycle low by the end of April.
Some market observers expect Federal Reserve accommodation towards market activity with the possibility of rate cuts and quantitative easing measures in May to ease the liquidity. But global tariffs associated with the Trump administration’s tariffs pose westerly headwinds for cryptocurrency markets.
Following its recent ETH sale, it is unclear what World Liberty Financial’s future strategy is. Currently, the company has denied allegations of unauthorized token sales, or token swaps, and has been responding to growing fears of bad token management practices.
Depending on shifting market dynamics, the firm would likely decide whether it will continue liquidating its Ethereum assets or not retain its position left. It also relies on the company’s own analysis of the company’s current and future crypto valuations.
Conclusion
Despite the cryptocurrency markets skewing downward, World Liberty Financial is now at a crossroads. Evidently, the challenging environment for digital asset investors in 2025 is evidenced by its decision to sell Ethereum at a high loss, mainly by those who were present in the market at higher price points.