World Liberty Financial Token (WLFI), a DeFi governance token linked to the Trump family, may have signaled a major market crash in the hours before Bitcoin’s move, according to novel analysis by data provider Amberdata.
The report analyzes trading activity on October 10, 2025, when approximately $6.93 billion in leveraged crypto positions were liquidated in less than an hour. Bitcoin (BTC) fell by about 15% and Ether (ETH) fell by about 20%, while smaller tokens lost as much as 70%.
Amberdata found that the WLFI began falling sharply more than five hours before the broader market downturn. At this time, Bitcoin was still trading near $121,000 and was not showing immediate stress.
“It’s hard to dismiss the five-hour turnaround time as a coincidence,” Mike Marshall, author of the report, told Cointelegraph. “This duration is what distinguishes a truly useful warning from a statistical artifact,” he added.
Related: Senators ask Bessent to investigate United Arab Emirates’ stake in $500 million Trump-linked WLFI
WLFI anomalies before the sale
Researchers analyzed three unusual patterns, including a pointed augment in trading activity, a pointed shift away from Bitcoin and extreme leverage, to determine whether WLFI signaled stress ahead of a broader market sell-off.
WLFI’s hourly volume rose to about $474 million, about 21.7 times its normal volume, within minutes of the tariff-related political news breaking. Meanwhile, WLFI perpetual futures financing rates have reached around 2.87% every eight hours, equating to an annual borrowing cost of close to 131%.
The study does not conclude that any insider trading occurred. Instead, he argues that the structure of cryptocurrency markets can make some assets more significant than their size suggests.
According to the report, WLFI’s holder base is concentrated among politically connected participants, unlike Bitcoin’s widely dispersed ownership. Marshall said the trading pattern appeared to be “instrument specific,” meaning activity was focused on WLFI rather than the broader crypto elaborate.
“If this was better analysis (sophisticated participants would read tariff headlines faster and draw better conclusions), you would expect this to be reflected more broadly,” he said. “What we actually saw was primarily concentrated activity in WLFI.”
The timing is noteworthy. Trading volume accelerated about three minutes after the tariff news was released. Marshall said that speed suggested prepared execution rather than retail traders’ real-time interpretation of headlines.
The link between WLFI and the broader market decline comes down to leverage. Many cryptocurrency trading platforms allow investors to utilize several assets as collateral for borrowed positions. When the WLFI plummeted, the value of this security fell, forcing traders to sell liquid assets such as Bitcoin and Ether to cover their positions. These sales resulted in falling prices and further liquidations across the market.
Related: Trump Family WLFI Plans Foreign Exchange and Remittance Platform: Report
WLFI responded to the stress faster than Bitcoin
Amberdata data shows that WLFI’s realized volatility reached almost eight times Bitcoin’s volatility during this episode, making it particularly sensitive to stress. Researchers argue that during market shocks, assets with a frail structure and high financial leverage may be the first to move.
Marshall said the results should not be interpreted as evidence that the WLFI can reliably predict a downturn. The analysis covers a single event, and more data would be needed to establish statistical consistency. Still, he finds this behavior significant.
“So the lifespan of this signal is limited. It is valuable now because it is not monitored sufficiently,” he said. “The moment a consensus is reached, alpha is arbitraged. This is how all market signals work. The ones that stick are the ones that no one pays attention to.”
Warehouse: Bitget’s Gracy Chen is looking for “entrepreneurs, not wannabe entrepreneurs”
