Justin Sun was reportedly offered a settlement behind the scenes by investor World Liberty Financial, although no decision has been announced. This unresolved tension now has a new flashpoint: Sun’s cryptocurrency exchange HTX has gone fully operational. to cross out USD1, the stablecoin linked to US President Donald Trump’s Global Financial Freedom Project.
The freeze that started it all
Cooperative Announce On June 6, USD1 will be removed from its platform on June 7. Users holding USD1 on the exchange will have their balances converted to USDT at a 1:1 rate, with the transferred funds credited to their spot accounts.
The exchange said the decision was made to reduce potential risks, protect users’ assets, and maintain fair trading conditions. HTX stopped short of calling it retaliation, but the timing leaves little ambiguity.
🪧 Huobi HTX’s explanation of dealing with $WLFI and $USD1 assets
Project party World Liberty Financial (WLFI) recently unilaterally took freezing measures on addresses linked to Huobi HTX on the basis of a review of compliance with relevant sanctions, resulting in restrictions on the trading of certain WLFI assets on-chain.
Since USD1 is also provided by WLFI…
— Huobi HTX (@HuobiGlobal) June 6, 2026
The day before, on June 5, HTX had already suspended several trading pairs that included WLFI tokens – including WLFI/USDT, USD1/USDT, BTC/USD1, and ETH/USD1.
The suspension came after what HTX had previously described as a unilateral move WLFI The project team froze on-chain wallet addresses associated with Huobi HTX, citing sanctions compliance reviews as justification.
A lawsuit is pending over the dispute
the conflict It does not exist in isolation. It takes place against the backdrop of an active legal battle between Sun and WLFI.
Sun filed a lawsuit against the project, alleging that its tokens were frozen without reason and that WLFI operated a blacklisting mechanism capable of restricting or destroying users’ funds.
🪧 Announcement regarding Huobi HTX removing USD1 (USD1) and exchanging user assets to USDT
Considering that USD1 is an asset issued by the WLFI project party, in order to reduce potential risks, ensure the security of user assets and maintain a fair trading environment, Huobi HTX will write off USD1 at 11:00 on June 7, 2026 (UTC+8), and exchange USD1 in the user account that meets the exchange range to USDT in the ratio of 1:1.
After the exchange is completed, the corresponding USDT will be transferred… https://t.co/O34q0Joc7k
— Huobi HTX (@HuobiGlobal) June 6, 2026
WLFI responded with a countersuit, accusing Sun of running a coordinated smear campaign and using social media influencers and bots to spread harmful claims about the project.
The two sides do not appear to be close to reaching a solution. A settlement offer from a major WLFI investor has been made to Sun, but it has not made a public statement indicating progress on that front.
What comes next for USD1 holders
For users of the exchange, the immediate impact is straightforward: USD1 holdings will be exchanged for USDT, and the exchange said the distribution timeline will be confirmed separately.
The broader question – whether WLFI’s summons to comply with sanctions for freezing the counterparty’s on-chain addresses has a legal basis or is tactically motivated – remains open.
Neither WLFI nor its legal representatives have issued a detailed public explanation for the freeze.
USD1 is a stablecoin issued by World Liberty Financial, a cryptocurrency project backed by Trump.
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