HTX suspends WLFI and USD1 trading after freeze, converts user USD1 to USDT

HTX said it will permanently remove World Liberty Financial's USD1 stablecoin from its platform on June 7 and convert eligible retail user holdings into Tether's USDT at a 1:1 ratio after the Trump-linked project's team froze HTX-controlled onchain addresses. The exchange had already suspended trading in WLFI/USDT, USD1/USDT, BTC/USD1 and ETH/USD1 at 13:00 UTC on June 5, saying the move was needed to protect users, preserve market fairness and limit systemic risk. HTX said the blocked wallets hold ordinary customer funds rather than illicit capital and argued the freeze violated users' property rights. The dispute follows the U.K.'s May 26 sanctions designation of Huobi Global S.A., which British authorities said helped process about $1.5 billion tied to the A7 payments network and sanctioned Russian exchange Garantex. HTX says the sanctioned legacy entity is separate from its current platform. The standoff has widened scrutiny of issuer-controlled freeze functions in stablecoins, especially as USD1's circulating supply has grown to more than $4.6 billion and as compliance measures collide with exchange liquidity and retail access.