HTX Freezes WLFI Trading After Token Freeze Sparks User Rights Dispute 

Highlights:

• HTX halted WLFI and USD1 trading after the project froze exchange-linked addresses.
• User USD1 balances shifted into USDT while WLFI withdrawals remain tied to the freeze.
• The dispute centers on sanctions reviews, issuer controls, and user asset rights.

HTX, a Seychelles-based cryptocurrency exchange, suspended WLFI and USD1 markets after World Liberty Financial froze several exchange-linked on-chain addresses. The exchange said in its official announcement on Saturday that the action affected tokens that individual users had lawfully bought. It said the addresses did not hold assets for a sanctioned entity or the platform itself, moving the dispute from compliance review to user ownership.

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The suspension began at 13:00 UTC on June 5, covering WLFI/USDT, USD1/USDT, BTC/USD1, and ETH/USD1 pairs. The exchange also stopped USD1 deposits and withdrawals. Moreover, it moved the user’s USD1 balances into USDT as a protective step.

The platform claims that WLFI restricted the addresses due to United Kingdom sanctions screening on May 26. However, the exchange revealed that it was not provided with a clear explanation of the legal grounds, scope, standards, and review process. It also stated that the freeze affected tokens that were purchased by the users via regular trading channels.

Official Statement from HTX Regarding the Handling of WLFI and USD1 Assets

The World Liberty Financial (WLFI) project team recently stated that it has unilaterally imposed a freeze on specific HTX on-chain addresses based on sanctions compliance reviews.

As a result, the…

— HTX (@HTX_Global) June 6, 2026

HTX Frames Freeze as User Rights Issue

The exchange contested the grounds of the address freeze. It stated that WLFI lacked sufficient communication, legal argument, transparent disclosures, or due process. Therefore, the platform claimed that the move impacted lawful customers who purchased the assets via regular trading channels.

Liu Ye, the exchange spokesperson and marketing head, also criticized the action. “The restricted assets were not associated with any sanctioned entity,” she said. 

Something deeply concerning happened recently.

The WLFI team froze WLFI tokens held in HTX-related addresses, citing the ongoing UK sanctions review.

To be clear:

These are not assets belonging to any sanctioned entity.

They are not HTX’s assets.

They are assets legally… https://t.co/duQg1xDBSy pic.twitter.com/UI8hJYnN48

— 火币HTX六爷｜火币赚币 (@HTX_Molly) June 6, 2026

Moreover, Liu raised an ownership concern for the digital asset market. She questioned whether users really have access to assets when a project could limit access with no clear guidelines. Her remarks echoed issues with admin controls in token contracts.

Exchange Converts USD1 Balances Into USDT

The exchange responded by freezing related services until the issue receives a clear resolution. WLFI balances still appear in user accounts, and the platform said the tokens have not disappeared. However, withdrawals will resume only after the on-chain restrictions end.

Moreover, the exchange suspended USD1 deposits and withdrawals. It said all customer USD1 balances would move into USDT on a uniform basis. Later notices will provide conversion details for affected account holders.

This step showed concern over exposure to another asset issued by the WLFI team. Since USD1 sits within the same project structure, the exchange treated it as a linked risk. As a result, it moved users into USDT to limit uncertainty during the dispute.

The exchange also said Huobi Global S.A. differs from the online trading platform. It added that any designation tied to that listed entity should not affect current operations.

The exchange has asked for the freeze to be lifted immediately. It also said that it might consider legal procedures to safeguard users. At the same time, WLFI has not given a specific public response within the provided information. At the moment, trading is suspended in the affected pairs. Users will still be able to view WLFI balances, but transfers depend on the project lifting restrictions.

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