World Liberty Financial Loses $125 Million on Ethereum Investments

World Liberty Financial (WLFI), a decentralized finance (DeFi) platform backed by President Donald Trump and his family, has recently faced a significant financial setback. The platform liquidated some of its cryptocurrency holdings, resulting in a substantial loss of $125 million on its Ethereum (ETH) investments.

According to the latest data, a wallet potentially linked to World Liberty Financial sold 5,471 ETH, valued at approximately $8.01 million, on April 9 for $1,465 per token. This sale marks a considerable loss compared to the project’s earlier investment when it reportedly spent $210 million to acquire 67,498 ETH at an average price of $3,259 per token.

The wallet first withdrew ETH from Aave, where it was earning yield or used as collateral. It then sent the funds to CoW Protocol, a decentralized exchange aggregator, and swapped the ETH for USDC, possibly to reduce market exposure or prepare for new investments.

Despite this loss, the World Liberty Financial portfolio recorded a 13.41% increase in the first quarter of 2025. The wallet’s value grew from $72.82 million to $82.51 million during this period.

The selling of Ethereum by WLFI coincides with a period during which Ethereum has taken a major hit, losing the $2,000 support level amid a broader cryptocurrency market sell-off. At the time of reporting, Ethereum was trading at $1,484, down a massive 20% over the past week.

WLFI has shown strong interest in Ethereum through continued accumulation and receiving a show of confidence from the platform’s associates. In February, Eric Trump, the first son, recommended amassing ETH. In late March, the DeFi platform boosted its Ethereum holdings by $10 million and increased its Wrapped Bitcoin (BTC) reserves to 162.69 WBTC. Additionally, WLFI invested $1.5 million in MOVE tokens.

As of the latest reports, World Liberty Financial’s total portfolio has declined by 2.5% and is now valued at $97.15 million. Ethereum accounts for one of the largest shares at 5.3%.

This significant loss highlights the volatility and risks associated with cryptocurrency investments, even for well-backed platforms like World Liberty Financial. The decision to liquidate holdings at a loss suggests a strategic move to mitigate further losses or reposition the portfolio in response to market conditions.

The broader cryptocurrency market sell-off, which has affected Ethereum’s price, underscores the challenges faced by investors in this volatile sector. The decline in Ethereum’s value from its acquisition cost to its current trading price has resulted in substantial unrealized losses for WLFI.

Despite the setback, WLFI’s portfolio showed growth in the first quarter of 2025, indicating that the platform has been actively managing its investments. The increase in the portfolio’s value suggests that the platform has been successful in generating returns through other investments or strategies.

The liquidation of Ethereum holdings and the subsequent loss of $125 million is a significant event for World Liberty Financial. It highlights the importance of risk management and strategic decision-making in the cryptocurrency market. The platform’s continued interest in Ethereum and its associates’ confidence in the cryptocurrency suggest that WLFI remains committed to its investment strategy despite the recent setback.