WLFI Issues Compliance Notice Amid Sanctions Concerns

World Liberty Financial (WLFI), a crypto venture linked to former US President Donald Trump, has issued a compliance warning to its users. According to the notice, transfers involving sanctioned individuals or organizations may be delayed, restricted, or rejected due to regulatory requirements around prohibited transactions.

The move comes after WLFI's presale process was scrutinized by US authorities, who questioned whether addresses tied to Russia, North Korea, and the blacklisted privacy mixer Tornado Cash had bypassed the project's early screenings. WLFI has maintained that it applies strict anti-money laundering and identity checks, but its admission of hard-coded powers to freeze or burn wallet balances has raised concerns about the project's compliance readiness.

The notice highlights the tension between WLFI's decentralized platform and federal regulations on prohibited transactions. The project's application layer is bound by federal rules on prohibited transactions, despite operating on public, decentralized rails.