Crypto exchange HTX has escalated tensions with World Liberty Financial after announcing the full removal of USD1, the stablecoin linked to the Trump-associated project, deepening an already volatile dispute involving billionaire entrepreneur Justin Sun.
The decision comes at a time when behind-the-scenes settlement talks involving Sun and a World Liberty Financial investor are reportedly ongoing, though no agreement has been confirmed publicly.
HTX Announces Forced Conversion of USD1 Holdings Into USDT
On June 6, HTX confirmed that USD1 would be delisted from its platform within 24 hours, with trading scheduled to end on June 7.
Users holding the stablecoin will have their balances automatically converted into USDT at a 1:1 ratio, with funds credited directly to their spot accounts.
The exchange stated that the move was intended to reduce risk exposure, safeguard user funds, and preserve fair trading conditions across its platform.
However, the timing has drawn attention given the recent breakdown in relations with the USD1 issuer.
Trading Suspensions Preceded Full Delisting Decision
The delisting follows a broader suspension of trading activity involving WLFI-related assets just one day earlier, on June 5.
HTX had already halted several pairs, including WLFI/USDT, USD1/USDT, BTC/USD1, and ETH/USD1, effectively freezing major liquidity channels tied to the project.
According to HTX, the action came after WLFI reportedly initiated compliance-based sanctions reviews that resulted in the freezing of blockchain addresses linked to the exchange, limiting the movement of certain assets.
Retaliation Claims Fuel Market Speculation
Although HTX has not explicitly described the delisting as retaliation, the sequence of events has fueled widespread speculation within the crypto community.
The exchange cited risk mitigation and user protection as its official rationale, but industry observers have noted the rapid escalation following WLFI’s earlier restrictions on HTX-linked wallets.
The dispute has quickly evolved beyond technical trading issues into a broader confrontation over control, compliance, and authority within decentralized finance infrastructure.
Legal Battle Between Sun and WLFI Intensifies
The situation is further complicated by an ongoing legal conflict between Justin Sun and World Liberty Financial.
Sun has filed a lawsuit alleging that WLFI improperly froze his tokens and maintains a system capable of blacklisting user assets without due process, effectively restricting access or destroying value.
In response, WLFI has launched a countersuit accusing Sun of orchestrating a coordinated smear campaign, including the use of social media amplification and inauthentic engagement tactics to damage the project’s reputation.
Despite these competing claims, neither side has indicated any meaningful progress toward resolution, even as settlement discussions reportedly circulate behind the scenes.
Uncertainty Mounts for USD1 Users and WLFI Ecosystem
For users holding USD1 on HTX, the immediate consequence is clear: assets will be forcibly converted into USDT, effectively removing exposure to the WLFI ecosystem on one of its key trading venues.
However, broader uncertainty remains around the legal and operational legitimacy of the asset freezes that triggered the escalation.
WLFI has not issued a detailed public explanation of its actions, while HTX maintains that its decisions were made to protect users amid heightened risk conditions.
As the dispute continues to unfold, the clash between exchange policy, legal pressure, and project governance has placed USD1 at the center of one of the most contentious crypto standoffs in recent months.
