WLFI spikes 130% then drops 50%, triggering liquidation risks
World Liberty Financial’s WLFI token debuted with a 130% surge to $0.48 within five minutes, driven by frenzied leveraged buying that pushed open interest to a record $1.03 billion and lifted its market cap to $9.86 billion. Shortly after, WLFI retraced 22% in minutes, spiking short-term liquidations and profit-taking. On-chain data show presale wallets moving 160 million WLFI to Binance and team wallets shifting 321.4 million WLFI to Bybit, signaling early sell pressure. Nearly $500 million was liquidated in the past 24 hours—67.7% from long positions—with $30 million wiped out on WLFI alone. Total crypto market cap fell from $3.77 trillion to $3.64 trillion. With 75.4 billion tokens still locked and fresh leverage flooding in, traders face a classic setup for another volatility loop and potential sharp downturn.
Bearish
WLFI’s debut volatility—130% spike followed by a 50% retracement—reveals a fragile price structure dominated by excessive leverage. Record open interest of $1.03 billion and nearly $500 million in liquidations indicate significant risk from cascading margin calls. With 75.4 billion tokens still locked and early profit-taking already underway, sell pressure is high. Historical parallels with tokens like TRUMP show that emotion-fueled spikes often precede sharp downturns when support fails. In the short term, liquidation cascades could deepen losses, while long-term token unlocks threaten a supply overhang. These factors point to a bearish outlook.