Cryptocurrency exchange HTX has officially delisted the USD1 stablecoin on June 7, 2026, at 11:00 UTC+8, following a major dispute with the World Liberty Financial (WLFI) project team. The exchange, linked to entrepreneur Justin Sun, maintains that the decision was necessary after World Liberty Financial unilaterally froze on-chain wallet addresses associated with HTX.
To protect its users, the platform is converting eligible USD1 holdings into USDT at a 1:1 exchange rate.
The conflict between the two firms began in May 2026 when World Liberty Financial, a decentralized finance project co-founded by the Trump family, froze specific HTX addresses. The project team cited “sanctions compliance reviews” following the United Kingdom’s decision to sanction Huobi Global S.A. on May 26, 2026. While Huobi Global S.A.
is a Panama-registered entity connected to HTX, the exchange has repeatedly clarified that it is a distinct entity from the sanctioned firm.
HTX responded to the freeze by suspending trading for WLFI and USD1 pairs on June 5, 2026. This included pairs against USDT, Bitcoin, and Ethereum. The exchange also halted all USD1 deposits and withdrawals. This move effectively ends a partnership that saw com/trump-media-bitcoin-deposit-cryptocom-transfer/”>Trump-linked digital assets gain high-level liquidity on international exchanges just a year prior. It marks a significant shift for USD1, which had a circulating supply of $2.54 billion as recently as late 2024.
HTX converts user USD1 holdings to USDT
To mitigate the impact on retail traders, HTX is moving all eligible USD1 balances into USDT spot accounts. The exchange emphasized that these assets belong to individual users who legally purchased them, not to the exchange itself or any sanctioned entities. HTX claims the freeze by World Liberty Financial was “conducted without sufficient prior communication” and lacked “adequate contractual or legal grounds.”
The delisting also extends to investment products. HTX has confirmed it will delist all WLFI and USD1 “Earn” products and settle those assets for users. This ensures that yield-seeking investors are not left with frozen collateral in the wake of the corporate fallout. Such moves are common when stablecoin risks materialize due to protocol mismanagement or external legal pressures.
Future distribution of the converted USDT is expected to follow a separate schedule, which HTX will announce soon. For now, the move allows users to maintain the dollar-pegged value of their holdings despite the underlying token being removed from the marketplace. HTX stated this action is aimed at maintaining “a fair trading environment” and ensuring “the safety of user assets.”
Legal battle and the Huobi Global S.A. sanctions
The dispute has already moved into the legal system. Justin Sun has claimed his tokens were frozen without cause, alleging that WLFI uses a secret “blacklist” mechanism. In a counter-move, World Liberty Financial filed a defamation lawsuit against Sun. The project team maintains that the freeze was a non-negotiable step to comply with the Russia sanctions regulations overseen by UK authorities.
World Liberty Financial has been a high-profile entrant in the DeFi space, raising over $700 million since its September 2024 launch. Its first public sale round, which ran until January 2025, raised roughly $300 million by selling 20 billion tokens. However, the loss of HTX as a primary trading venue presents a hurdle for the project’s liquidity and regional reach in Asian markets.
The exit from HTX may prompt investors to reconsider where they store their digital wealth. Recent data shows that Bitcoin supply on exchanges is reaching multi-year lows as traders move assets into private custody. This trend suggests that centralized platform disputes often lead to broader shifts in how retail investors interact with the crypto ecosystem.
Impact on WLFI withdrawals and market standing
While USD1 holders are being compensated via USDT conversion, those holding the WLFI governance token face more rigid restrictions. HTX has confirmed that WLFI withdrawals will remain paused until the World Liberty Financial team lifts the freeze on exchange-linked addresses. There is currently no confirmed timeline for when, or if, these withdrawals will resume.
This incident highlights the tension between “decentralized” finance and the practical reality of corporate compliance. World Liberty Financial’s decision to freeze addresses based on sanctions against Huobi Global S.A. shows the power project teams retain over “blacklisted” wallets. HTX argues this power was used unfairly, infringing on the rights of thousands of individual token holders.
As the legal battle continues, the future of the Trump-linked stablecoin on other venues remains uncertain. USD1 first listed on HTX in May 2025, reaching a peak position as the fifth-largest stablecoin by market cap. The sudden delisting serves as a reminder to the industry of how quickly regulatory designations can derail even the most well-funded crypto initiatives.