- The controversial World Liberty Financial Token (WLFI) plummeted more than five hours before a market-wide crash that liquidated $6.93 billion in positions on October 10, 2025.
- Amberdata identified a specific surge of selling activity in WLFI just minutes after public tariff news, which was exacerbated by extreme leverage within the asset.
- Researchers theorize the token’s politically connected, concentrated holder base and its use as collateral triggered a cascade of liquidations that spread stress to major assets like Bitcoin and Ether.
A cryptocurrency linked to the Trump family may have been a canary in the coal mine for a historic $6.93 billion market crash, according to a new analysis. The report from Amberdata details how WLFI entered a sharp decline hours before Bitcoin and Ether collapsed by roughly 15% and 20%, respectively.
Mike Marshall, who authored the report, stated “A five-hour lead time is hard to dismiss as coincidence.” He argued such a duration separates a meaningful warning from a statistical fluke. The signal was preceded by three distinct anomalies in the WLFI market.
Firstly, its trading volume spiked to 21.7 times normal levels minutes after tariff news broke. Secondly, funding rates for its futures contracts implied an annualized borrowing cost near 131%. Consequently, WLFI’s intense leverage and volatility made it a fragile point in the system.
Marshall noted the selling appeared “instrument-specific,” concentrated solely in WLFI rather than across the crypto complex. This suggests the activity was not driven by broad analysis of the headline news. The speed of the reaction indicated prepared execution rather than retail interpretation.
The crash propagated through leverage mechanisms common on trading platforms. As WLFI’s price fell, its value as collateral dropped, forcing traders to sell more liquid assets like Bitcoin to cover positions. Consequently, those sales triggered further liquidations in a cascading effect.
Researchers caution the single event does not prove WLFI can reliably predict downturns. Marshall acknowledged its utility as a signal is finite and depends on being under-monitored. “The moment it becomes consensus, the alpha gets arbitraged away,” he concluded.
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