WLFI Urgently Burns $22 Million in Tokens, Ensures Full On-Chain Transparency in Response to Phishing Attack
World Liberty Financial (WLFI) initiated an emergency smart contract action late Wednesday night, burning tokens held in compromised wallets due to phishing attacks and mnemonic leaks—totaling about $22 million. These tokens were held in pre-launch wallets of affected users. To prevent further exploitation by hackers, WLFI promptly activated the burn mechanism and will redistribute tokens to users who complete identity re-verification.
WLFI clarified that the incident was not due to a system vulnerability, but resulted from users’ wallets being compromised via third-party tools.
Incident Background: Third-Party Security Vulnerabilities Triggered Asset Risks
Before the WLFI mainnet officially launched, a small number of users had their wallets compromised by hackers through phishing sites, malicious plugins, or mnemonic leaks. To contain the risk, the team froze affected wallets as early as September and began an individual reporting, review, and identity verification process. Verified users needed to resubmit KYC documentation to verify ownership and prevent disputes during token redistribution.
New Smart Contract Deployment Secures Safe, Auditable Batch Asset Recovery
To manage large-scale asset redistribution, WLFI developed and tested a new smart contract for secure batch transfers and recovery. Because this process took time, the team emphasized that asset security always takes precedence over speed.
On-chain records confirm the burn was executed via a multi-signature wallet, ensuring that the process was completely transparent and irreversible. Users who passed re-verification will gradually receive tokens in new wallets. The team will continue to freeze wallets tied to unreported or unverified users.
Official Statement: Not a Platform Vulnerability, But an External Attack
WLFI has reiterated that this incident was not caused by any system, smart contract, or platform security flaw, but by attackers exploiting vulnerabilities in third-party tools to control some users’ wallets. To meet compliance standards and protect the community, the platform:
- Froze affected wallets
- Conducted identity verification for ownership
- Executed token burn via smart contract
- Redistributed tokens on-chain
The entire process is verifiable on the blockchain, guaranteeing transparency and trust.
(Source: worldlibertyfi)
What Should Users Do Next?
- Users who have completed reporting and verification will soon receive reallocated tokens in their new wallets.
- Affected users who have not yet reported can still submit a case and verification materials to customer service. Upon approval, they too can recover their assets.
Register at: https://www.gate.com/
Summary
WLFI’s response demonstrates its strong crisis management and its unwavering commitment to safeguarding user assets. By freezing at-risk wallets, conducting individual verification, burning tokens via smart contracts, and reallocating assets, the platform minimized losses while maintaining transparency and trust with its community. WLFI pledges to further strengthen security and thanks users for their patience and support throughout this process.
