"Sun Yuchen WFLI Incident: Address Dispersal Sparks Controversy, Huobi Withdrawal Latency Faces Scrutiny"

Recently, the founder of TRON, a well-known figure in the crypto world, Justin Sun has sparked discussions on platform X due to his team's address dispersion operations involving WFLI (Wrapped FLi token). On September 5, 2025, at 7:34 AM, Justin Sun released a statement via X, claiming that his team only conducted low-value exchange deposit tests and address dispersion operations, without any buying or selling, and that it would not impact the market. However, this statement not only failed to quell community skepticism but also led to greater controversy due to issues such as lack of transparency and withdrawal delays on Huobi (HTX). This article aims to objectively present the full picture of the event based on Justin Sun's statement, related posts on platform X, and online information, outlining the event's background, statement content, community reactions (including new questioning perspectives), and potential impacts.

Event Background

WFLI, as an emerging crypto asset, has recently garnered attention due to its presale and listing plans on exchanges such as MEXC and Huobi (HTX). According to online information, WFLI is the Wrapped FLi token, aimed at achieving asset tokenization through blockchain technology, and its presale and perpetual contract trading have attracted a large number of speculators. In August 2025, WFLI will launch perpetual contracts on exchanges like Binance, Bybit, and Huobi, with prices dropping from $0.55 to $0.22, experiencing significant volatility and heightened market sentiment.

As the founder of TRON and the actual controller of HTX (formerly Huobi), Sun Yuchen often attracts market attention with his operations (according to Bloomberg, Sun Yuchen acquired Huobi in 2022). Previously, he was embroiled in controversy due to the USDD stablecoin project (accused of imitating the failed TerraUSD) and allegations of TRX market manipulation (the SEC filed a lawsuit in 2023, which was later withdrawn in February 2025). In the WFLI incident, Sun Yuchen's statement attempted to clarify the nature of his team's operations, but the community raised strong concerns about its transparency and the latency issues with Huobi withdrawals.

Sun Yuchen's statement content

On September 5, 2025, at 7:34 AM, Sun Yuchen issued a statement on the X platform, responding to speculation from the outside world regarding his team WFLI's operations:

“Our Address has only done a few generic exchange deposit tests with very low amounts, and then made a distribution of addresses, without involving any buying or selling, and it is impossible to have any impact on the market.”

Key points of the statement:

Low amount deposit test: Sun Yuchen stated that his team only conducted small amount deposit tests, with amounts being negligible, possibly to verify the exchange's functionality or asset transfer process.

Address dispersion operation: The team disperses WFLI assets to multiple addresses, claiming it is for technical testing or security management, without involving buying or selling.

No market impact: Emphasizes that operations will not affect the price or liquidity of WFLI, attempting to dispel market concerns about its “manipulating” prices.

In addition, Sun Yuchen expressed optimism about WFLI in other X posts, stating that it could potentially replace Binance's FDUSD stablecoin position (quoted by @Michael_Liu93). He also warned about the market manipulation risks associated with the XCN project, urging exchanges to enhance monitoring (January 24, 2025, ChainCatcher), indirectly indicating concerns about market fairness.

X platform community feedback

Sun Yuchen's statement has sparked intense discussions on the X platform, with polarized community opinions, supporters and skeptics at odds. Below are the reactions整理 based on X posts and information provided by users, including newly added skeptic viewpoints:

Supporters' Views

Technical operations are reasonable: Some users believe that deposit testing and address diversification are routine operations for new coin listings. @Michael_Liu93 stated: “The subsequent gaming space for WFLI is not small, and the minimum drop fruit is to replace the position of FDUSD.” He believes that Sun Yuchen's involvement may bring liquidity support to WFLI, attracting more exchanges' attention.

IDO Potential: @butaidongjiaoyi analyzes the second round of IDO (Initial DEX Offering) for WFLI, with a price of $0.05, an initial unlock of 20%, and a total market cap of 25 billion. Investors may quickly recoup their investment, suggesting that Sun Yuchen's actions are to heat up the project, in line with market logic.

Skeptic's viewpoint

Insufficient transparency: @Vida_BWE questions the lack of specific data support in the statement: “Are you brave enough to disclose the initial holding address? What exactly is the low amount for the test? Who will believe it without data?” He pointed out that the WFLI price of $0.42 (corresponding to a $42 billion FDV) far exceeds ENA's ($11 billion FDV), making it difficult for public offerings to attract institutional buying, and he suspects Sun Yuchen is concealing the scale of operations.

Withdrawal latency issue: @CryptoWatcher88 complained about the withdrawal efficiency on Huobi: “I have been waiting for half an hour for my WFLI withdrawal from Huobi, why hasn't it arrived? The exchange is so big, yet the system is so slow, and they don't explain the withdrawal issues in their statements, is it intentional delay?” This viewpoint has been widely shared on platform X, reflecting users' dissatisfaction with Huobi's operations.

Manipulation Suspicions: @0xcryptowizard analyzes the WFLI track, acknowledging its advantages in both Chinese and English communities, but questioning the high price and the community's activity level compared to Solana/Base's meme coins. He stated: “A dispersed address sounds like money laundering. Does Sun Yuchen dare to publicly disclose the on-chain transaction records? Not disclosing is just being guilty.” This viewpoint echoes the community's general concern for transparency.

Historical trust issues: @BlockchainSkeptic mentioned the past controversies of Sun Yuchen: “USDD and TRX have both engaged in commingling funds, and the SEC has sued before. Now WFLI comes with this? Public initial address and transaction hash, otherwise who would dare to invest?” He quoted a Protos report, pointing out that the USDD reserve address controlled by Sun Yuchen (TZ1SsapyhKNWaVLca6P2qgVzkHTdk6nkXa) also appears in the HTX reserves, questioning the transparency of its fund management.

Market Sentiment and Dynamics

Price volatility: After the launch of the WFLI contract, the price fell from $0.55 to $0.22, reflecting heightened speculative sentiment. Huobi launched the WFLI/USDT perpetual contract on August 27, offering 1-5 times leverage and a $10,000 prize pool (Bitget), but the deposit latency issues have exacerbated user dissatisfaction.

Community differentiation: WFLI is seen as a “mass vehicle” (retail-driven), with low institutional participation. @Domingo_gou commented: “WFLI faces significant short-term selling pressure risk, and Sun Yuchen's statement seems more like crisis management, failing to conceal the suspicion of opaque operations.”

Potential Impact of the Event

Sun Yuchen's WFLI statement and its fermentation on the X platform have had multiple impacts on the market and the community:

Market Trust and Transparency:

Sun Yuchen's statement attempts to dispel concerns of manipulation, but without disclosing the initial holding address, test amounts, or on-chain transaction records, it is difficult to quell doubts. The new community calls (such as “Are you brave enough to disclose the initial holding address yourself?”) highlight the transparency issue. The crypto market is sensitive to transparency, and lessons from the TerraUSD collapse (Forbes, 2022) have made investors wary of Sun Yuchen's actions.

The withdrawal latency issue on Huobi (“WFLI not credited after half an hour”) further undermines user trust, which may lead to retail investor loss and affect WFLI liquidity.

WFLI price and liquidity:

The high valuation of WFLI (0.42 USD corresponding to a 42 billion USD FDV) has been questioned by the community, and the price volatility risk is high. The presale and leveraged trading on exchanges like Huobi and MEXC attract speculators, but the deposit latency may exacerbate the selling pressure.

Sun Yuchen's optimistic remarks (such as replacing FDUSD) may boost confidence in the short term, but long-term stability in prices will require more institutional support.

Sun Yuchen's industry influence:

As a KOL in the crypto world, Sun Yuchen's remarks significantly influence market sentiment. However, past controversies (such as the confusion over USDD funds and the SEC lawsuit) have damaged his credibility. The recent WFLI incident may further amplify discussions about trust in him.

His discussion with James Wynn's X Space (involving high leverage risks, Blockchain.news) indicates that he is trying to repair his image through public dialogue, but skeptics believe this may be a distraction.

Regulatory and compliance concerns:

Sun Yuchen reported XCN manipulation to the SEC and DOJ (ChainCatcher, 2025), demonstrating his concern for compliance. However, the opacity of WFLI's operations may attract the attention of regulatory agencies, especially against the backdrop of tightening regulations on virtual assets in Hong Kong (refer to Hong Kong's RWA policy).

The withdrawal latency issue on Huobi may trigger user complaints and increase compliance pressure on the platform.

From a first principles perspective, the WFLI incident reflects the typical challenges of new coin listings: project teams need to attract attention through testing and promotion, but any operation can be amplified into suspicions of “manipulation.” Sun Yuchen's statement, lacking on-chain data support, is difficult to dispel community concerns, especially in the following aspects:

Transparency: Publicly disclosing the initial holding address, test amount, and transaction hash is key to rebuilding trust. The community questions, “Are you brave enough to make the initial holding address public?” which gets to the heart of the issue.

Exchange Operation: Huobi withdrawal latency (“half an hour not credited”) reflects platform system efficiency issues, which may be related to high trading volume or technical bottlenecks, and needs to be optimized as soon as possible.

Market positioning: WFLI needs to balance retail and institutional participation, enhancing community activity to combat competition from Meme coins (such as Solana/Base ecosystem).

In the future, the development of WFLI depends on:

Transparency Improvement: Sun Yuchen needs to disclose on-chain data to respond to the community's doubts about the initial address and transaction records.

Exchanges supported: Huobi needs to address the withdrawal latency issue to optimize user experience; more exchanges (such as Binance, Bybit) launching WFLI could enhance liquidity.

Regulatory Compliance: The stablecoin and RWA policies in Hong Kong provide compliance opportunities for WFLI, but the opening of the secondary market will take time, and Sun Yuchen needs to ensure that operations comply with regulatory requirements.

Community Building: The bilingual community of WFLI is an advantage, but it needs to enhance activity through mechanisms such as airdrops and governance to avoid pressure from “retail investors”.

Conclusion

Sun Yuchen's statement regarding the decentralization of the WFLI address attempts to clarify the nature of operations, but has raised strong doubts within the community due to the lack of disclosure of the initial holding address, testing amounts, and on-chain records. The new questioning voices (such as “Do you dare to disclose the initial holding address?” “Huobi's withdrawal of WFLI has not arrived for half an hour”) highlight issues of transparency and exchange efficiency. As an emerging token, WFLI faces price volatility, insufficient liquidity, and a crisis of trust. Sun Yuchen's influence in the industry makes his statements highly scrutinized, but more transparent operations are needed to address community concerns. Investors should pay attention to on-chain data (which can be verified through CoinGecko and Dune Analytics), exchange announcements, and regulatory dynamics, while being wary of high leverage trading risks. The future performance of WFLI requires more institutional support and community building, and is worth continuous observation.

Disclaimer: This article is based on posts from the X platform, user-provided information, and online materials, for reference only, and does not constitute investment advice. The crypto market is highly volatile, and investment should be approached with caution. It is recommended to consult official announcements and on-chain data for accurate information.