World Liberty Financial says USD1 stablecoin faced a coordinated attack, causing temporary depegging, token volatility, and renewed focus on crypto security safeguards.
A sudden wave of volatility shook crypto markets after WLFI reported a coordinated attack. The incident shook investor confidence and temporarily yanked the USD1 Stablecoin off its peg. However, trading conditions were stabilized by assurances of reserves issued by the company.
Market Turbulence Followed Social Media Account Breaches
World Liberty Financial said that perpetrators hacked several cofounder accounts on social media. According to the statement, hackers have gained access and published false messages online. As a result, fear-induced reactions become widespread on trading platforms and through online communities.
A coordinated attack was launched against USD1 this morning. Attackers hacked several WLFI cofounder accounts, paid influencers to spread FUD, and opened massive $WLFI shorts to profit from the manufactured chaos.
It didn’t work.
Thanks to USD1’s sound mint-and-redeem mechanism…
— WLFI (@worldlibertyfi) February 23, 2026
Paid influencers amplified FUD, and large WLFI shorts came into being rapidly, WLFI said. During the height of the stress, USD1 depegged temporarily, reaching 0.9802 against Tether’s USDT. Meanwhile, WLFI’s token price dropped over 8% before making a recovery later.
Eric Trump removed many WLFI-related posts on X during the turmoil. The deletions coincided with increased uncertainty, which increased speculation and short-term selling pressure. Nevertheless, WLFI emphasized that fundamentals were not damaged by transitory market disruptions.
WLFI explained that the mint and redeem system of the USD1 absorbed shocks and brought things back to equilibrium. Furthermore, the company confirmed full 1-to-1 backing that was supported by the redemption stability levels. Therefore, USD1 returned to parity soon as the confidence gradually improved again.
The firm called the episode market manipulation instead of technical failure. Additionally, internal monitoring systems also reported irregular flows and abnormal trading behavior. As a result, WLFI coordinated responses to contain volatility and misinformation.
Crypto markets have also been particularly exposed to social engineering attacks on liquidity and sentiment. However, there are often strong reserve mechanisms that limit damage from coordinated speculative strategies. Consequently, transparency and swift disclosure are still critical in regaining trust from investors.
Stablecoin Resilience and Security Risks Remain Key Focus
WLFI restated its long-term commitment to USD1 and ecosystem development in general. Meanwhile, the company promised more robust protections against account compromises and misinformation in the future. Ultimately, the incident brought to light persistent security risks against resilience of fully-backed stablecoins.
Regulatory conversations are focused more on governance, custody transparency, and audited reserve disclosures among stablecoins markets. Therefore, events such as this re-enforce calls for more transparency in reporting and greater controls in operations. Moreover, investor education is always necessary during any of the fast-moving volatility events in crypto trading.
WLFI mentioned that public blockchains make it possible to deposit without prior approval from receiving platforms. Accordingly, post-receipt screening and surveillance systems play a decisive protective role for exchanges. Thus, the risk mitigation in this case relies heavily on continuous monitoring and not on preventive blocking.
Market data revealed a brief liquidity squeeze when traders were faced with conflicting online narratives. However, volumes normalized gradually as redemption mechanisms brought prices to near-intended levels. Consequently, spreads tightened due to the stability that occurred across trading pairs from arbitrage activity.
Cybersecurity risks continue to be a constant threat to crypto companies and digital assets platforms. Therefore, companies spend a lot on layered defenses, monitoring tools and incident response strategies. Meanwhile, users are encouraged to check for announcements using official channels before they make decisions.
WLFI said investigations are ongoing, and compromised accounts are undergoing security investigations and restorations. In addition, coordination with platform providers is intended to avoid repeated incidents of unauthorized access.
WLFI concluded that safeguards and transparency aided in quickly neutralizing the attempted disruption. Meanwhile, USD1 was trading steadily at par as market confidence was restored. Ultimately, the episode highlighted resilience, risk awareness, and disciplined compliance practices on a global scale.