WLFI Drops After Token Loan; Hong Kong Licenses Two Stablecoins

On-chain data showed a wallet linked to World Liberty Financial deposited about 5 billion WLFI tokens on Dolomite, a decentralized lending platform co-founded by the platform’s chief technology officer, Corey Caplan. The wallet used those tokens as collateral to borrow roughly $75 million in USD1 and USDC stablecoins and later transferred more than $40 million of the proceeds to Coinbase Prime. WLFI fell to about $0.07714 on Saturday, down roughly 83% from a $0.46 peak in September, and was trading near $0.07879 at the time of reporting. WLFI has declined about 65% over the past year.

Market participants raised concerns because using large amounts of a project’s native token as loan collateral can add selling pressure and affect liquidity and governance.

In the United States, the Consumer Price Index rose 0.9% month over month in March, the largest monthly gain since 2022, and 3.3% year over year. Energy prices were the main driver of the monthly increase. Futures markets priced in under a 2% chance of a Federal Reserve rate cut at the upcoming meeting. Major cryptocurrencies held ground after the report, with Bitcoin trading above $73,000 and Ether near $2,300.

Separately, the Hong Kong Monetary Authority issued the first stablecoin licenses under its new regulatory framework, approving Anchorpoint Financial and The Hongkong and Shanghai Banking Corporation Limited, the local unit of HSBC. Anchorpoint is a joint venture that includes Standard Chartered Bank (Hong Kong), Animoca Brands and Hong Kong Telecommunications. The regulator updated its public register following the approvals.

In February, HKMA chief Eddie Yue indicated that only a very small number of issuers would be licensed in March; the authority announced the initial approvals after missing that timetable. World Liberty Financial markets itself with ties to former U.S. President Donald Trump.