HTX, the cryptocurrency exchange founded by Justin Sun, has made headlines with its decision to delist the USD1 stablecoin issued by World Liberty Financial (WLFI), a project linked to former President Donald Trump. This announcement, made on June 6, comes in the wake of WLFI’s freeze on specific HTX on-chain addresses, citing compliance with sanctions regulations.
Effective June 7, HTX will convert all user holdings of USD1 into USDT at a 1:1 ratio, with the converted funds credited directly to users’ spot accounts. This drastic measure follows HTX’s suspension of four trading pairs involving WLFI and USD1 just two days prior, on June 5.
In a statement regarding the delisting, HTX emphasized its commitment to safeguarding user assets and maintaining a fair trading environment. The exchange indicated that the decision was made to mitigate potential risks amid the ongoing compliance reviews associated with WLFI’s actions.
WLFI, on the other hand, has been vocal about its decision to freeze HTX-linked addresses as part of its sanctions compliance protocols. On June 3, the firm issued a reminder of its strict adherence to sanctions controls, stating that any transactions involving sanctioned entities could be blocked without prior notice. However, HTX has pushed back against these claims, asserting that the frozen assets do not belong to any sanctioned entity but rather to individual users who legally purchased and owned them.
The controversy surrounding this incident is rooted in the UK government’s recent designation of Huobi Global S.A., the parent company of HTX, as a sanctioned entity on May 26. UK officials accused Huobi of facilitating over $1.5 billion in transactions related to Russian sanctions evasion, a charge that Huobi has denied, maintaining that it operates separately from HTX.
Despite the ongoing tensions, WLFI has not publicly addressed the freeze on HTX addresses or the broader implications of the UK sanctions on its operations.
This is not the first instance of WLFI exercising its on-chain freeze functionality. In September 2025, the project blacklisted a wallet belonging to Justin Sun after he transferred approximately $9 million in WLFI tokens to addresses associated with HTX. This action was part of an ongoing legal dispute between Sun and WLFI, with Sun alleging that WLFI’s smart contract contains a hidden backdoor allowing the team to freeze investor tokens without notice.
In response, WLFI filed a countersuit against Sun, accusing him of orchestrating a defamation campaign through social media. While a settlement offer was reportedly made by a WLFI investor to Sun, no resolution has been publicly disclosed.
The delisting of USD1 from HTX marks a significant escalation in the ongoing conflict between the exchange and the Trump-associated crypto project, further complicating the landscape for investors and users of both platforms. As the situation develops, it raises pertinent questions about compliance, user rights, and the broader implications of sanctions in the rapidly changing world of cryptocurrency.
