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World Liberty Financial Token Falls on Unlock Proposal News

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Brian Armstrong's Bold Prediction: AI Agents Will Soon Dominate Global Financial

TLDR

  • WLFI price declined 14% to $0.08 within 24 hours.
  • Market capitalization dropped by $427 million to $2.58 billion.
  • World Liberty Financial plans a structured token unlock proposal.
  • The project holds $400 million in WLFI collateral on Dolomite.
  • The team denied liquidation risks and pledged additional collateral if needed.

World Liberty Financial’s (WLFI) governance token dropped sharply after the project outlined a token unlock proposal. The price fell to $0.08, marking a 14% daily decline. At the same time, market capitalization declined by $427 million to $2.58 billion.

World Liberty Financial Token Drops on Unlock Plan

World Liberty Financial confirmed it is preparing a governance proposal to unlock WLFI tokens for early holders. The project said the plan includes a structured vesting schedule to control supply release.

Currently, about 75% of WLFI tokens remain locked and cannot be traded. The team acknowledged “strong demand” from early participants seeking liquidity access.

The token launched as a non-transferable digital asset and later gained a valuation based on limited circulating supply. Public sales distributed around 20% of the total supply to investors.

World Liberty Financial raised $550 million from about 85,000 participants during two token sales. Token Unlocks data valued those distributed tokens at nearly $2 billion on paper.

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The team stated that the unlock proposal would not release all tokens at once. It added that a “long-term vesting and unlock schedule” will guide the process.

DeFi Loan Activity Sparks Liquidity Concerns

World Liberty Financial defended its $150 million stablecoin borrowing activity through the Dolomite protocol. The loans are denominated in USDC and backed by WLFI collateral.

Critics raised concerns about liquidity risks tied to WLFI’s limited tradable supply. Some users warned that liquidation events could create losses for liquidity providers.

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The project responded by rejecting those concerns and stating, “We are nowhere near liquidation.” It also said it would add more collateral if market conditions changed.

Blockchain data showed the project posted about $400 million in WLFI as collateral. This amount represents nearly 98% of the token’s supply on the platform.

Observers also questioned how the project plans to repay the borrowed stablecoins. Some transactions showed that part of the funds moved to Coinbase Prime accounts.

World Liberty Financial described its borrowing strategy as beneficial for users supplying stablecoins. It stated that users are “earning outsized stablecoin yields right now.”

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The Dolomite protocol’s lending pool for USD1 showed high utilization levels. This condition raised questions about borrowing limits and liquidity availability.

Despite concerns, the project maintained that its position remains secure under current conditions. It reiterated that additional collateral could support its loans if required.

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Crypto World

XRP Price Flashes Multiple Bottom Signals As Bulls Defend $1.30.

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XRP Price Flashes Multiple Bottom Signals As Bulls Defend $1.30.

XRP (XRP) has been in an eight-month downtrend, with momentum and onchain indicators at levels that previously coincided with macro bottoms.

Data from TradingView reveals that the relative strength index (RSI) of the XRP/BTC ratio is at 24, the most oversold level since October 2025. 

Such low levels in the daily RSI have marked market bottoms for the ratio, ultimately leading to 65% to 345% XRP price breakouts against Bitcoin as seen late 2024 and 2025.

XRP/BTC daily chart. Source: Cointelegraph/TradingView

The chart above also shows that the XRP/BTC pair is trading within a long consolidation range, which has previously acted as a strong launching pad for the ratio.

The last time XRP bottomed against Bitcoin around this zone was in June 2025. It marked the beginning of a 61% increase in the XRP/BTC ratio, accompanying a 92% XRP price rally to a multi-year high of $3.66.

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Other instances shown by the yellow bars in the chart reinforce the reliability of this level in marking macro bottoms for XRP/BTC. 

MVRV Z-Score suggests XRP price is bottoming

XRP’s MVRV Z-score is hovering near zero, a level that historically aligns with accumulation zones and market bottoms.

This indicates that most holders are close to breakeven, reducing sell pressure and signalling potential downside exhaustion. Similar patterns appeared in 2021, 2022 and 2024 before major rallies.

XRP MVRV Z-score vs. price. Source: Glassnode

Note that the last time XRP’s MVRV Z-score fell to similar levels in late 2024 coincided with a macro market bottom at $0.30 and preceded a multi-month rally, with the XRP/USD pair rising 500% to a multi-year high above $3. 

Meanwhile, the 0.80 MVRV pricing band, which has historically marked cycle bottoms, is currently at $1.14, coinciding with a 15-month low reached on Feb. 6.

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XRP: MVRV pricing bands. Source: Glassnode

These onchain metrics suggest that XRP is undervalued and may continue the ongoing recovery, potentially rising toward $1.70 or higher

XRP price must hold above $1.30 

Meanwhile, XRP/USD remains cautiously bullish as long as it holds the $1.25-$1.30 support zone. 

“$XRP is sustaining the major support zone between $1.30-$1.25 levels since early Feb’26,” trader ChiefraT said in an X post on Friday, adding:

“If this zone continues to hold, then a short-term bounce towards $1.45 can’t be ruled out.”

XRP/USD daily chart. Source: Cointelegraph/TradingView

The importance of this support level is reinforced by cost basis distribution. The heatmap below shows that nearly 1.73 billion XRP were acquired around this price.

XRP cost-basis distribution heatmap. Source: Glassnode

Below that, the next line of defence is the $1.15 demand zone, where the 200-week simple moving average is. 

If XRP/USD drops below this level, it would be in a free-fall toward the measured target of the bear flag at $0.80, or 41% below the current price.

As Cointelegraph reported, holding $1.27-$1.30 would be a sign of strength among the bulls who must push the XRP/USD pair toward the $1.61 range high to regain control. 

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