Today in Crypto: Futures Face Capital Flight as WLFI Works to Restore Trust

Gold Surges Past $3,500 as Crypto Futures Face $370M Liquidations; WLFI Battles Crisis of Confidence

Gold reached an all-time high above $3,500 per ounce on Tuesday, reinforcing its safe-haven appeal as bitcoin (BTC) traded listlessly near $110,752. The muted price action in BTC masked turbulence in derivatives markets, where exchanges liquidated $370 million in futures positions over the past 24 hours after bearish bets were caught offside.

Lookonchain data showed whale address 0xFf15 unloaded 425 BTC, worth $46.5 million, in exchange for over 10,500 ETH during the past four days. Separately, Glassnode reported long-term holders realized gains by spending 97,000 BTC on Friday, highlighting profit-taking at elevated price levels.

Derivatives Landscape

The liquidations triggered a decline in open interest (OI) across most major tokens, though BTC futures OI rose by more than 1%, signaling new capital inflows. XRP posted a “spinning bottom” candle, hinting at reversal potential, but OI in USD- and USDt-margined perpetuals dropped 5.69% amid weak spot activity.

Funding rates on BTC, ETH, and other majors hovered just above zero, indicating only a mild long bias. CME positioning in BTC futures remained thin, while ether futures maintained near-record OI of 2 million contracts.

Options markets pointed to caution: Deribit data showed BTC puts trading at a premium to calls through December expiry. ETH options carried a softer put skew, while SOL and XRP contracts reflected stronger demand for upside exposure. BTC block flows leaned defensive, with traders buying September $105K puts and selling October $135K calls. ETH traders lifted puts at $3,800 and $4,200 strikes.

WLFI Under Pressure

World Liberty Financial (WLFI), the Trump-affiliated DeFi project, is advancing a buyback-and-burn mechanism to rebuild investor confidence after a troubled debut. Under the plan, fees from liquidity pools on Ethereum, Binance Smart Chain, and Solana would be used to repurchase tokens for permanent removal, reframing supply dynamics around engineered scarcity.

The token currently trades at $0.23 with a $6.39 billion market cap—down 24% on the day and far below its launch-time futures valuations above $40 billion. A parallel governance proposal calls for staking 80% of locked supply into pools, with rewards funded by a 20% reserve. Proponents say this activates dormant tokens, while critics argue it recycles supply without addressing fundamentals.

WLFI’s rollout has also been undermined by exploits. Hackers leveraged Ethereum’s EIP-7702 delegate contract feature to siphon funds in phishing-style attacks, leaving some investors with only partial holdings. Security firm SlowMist warned the exploit triggers automatically when compromised users initiate transfers.

Meanwhile, scam clones and phishing campaigns spread across Telegram and X, exacerbating retail losses. With price collapse, governance tensions, and security threats converging, WLFI faces an uphill battle to establish credibility.

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