Two of the partners of the American president Donald Trump of his company Crypto World Liberty Financial Financial (WLFI) were accused of having abandoned the investors of a previous decentralized finance project (DEFI), which suffered a feat of $ 2.5 million nearly a year ago.
Protocol exploited to the Crypto partners of Trump
On Monday, Reuters reported that two of President Trump’s business partners, Chase Herro and Zak Folkman, left their customers from the finance of the abandoned DEFI protocol paste after the exploitation of the platform.
Finance paste, co -founded by Herro and Folkman, was an open source protocol to create non -guardian liquidity markets. Last year, the project underwent a flash loan attack which took more than $ 2.55 million in USDC and Ethereum (ETH).
As reported by Bitcoinist, on July 12, a pirate handled the intelligent paste contract finances and stole the user funds, leaving investors empty. The protocol team sent a chain message to the operator offering a white hat bonus if the funds had returned.
At the end of July, only 76.2 ETH of erroneous cryptographic assets, worth around $ 281,000, had been recovered by the cybersecurity company SEAL 911 and promised to be distributed to cryptographic investors.
However, despite the distribution of approximately $ 180,000 in ETH in the official project portfolio at 134 addresses in September, several investors would have declared to Reuters that they had not received such payment.
In an average post, the DEFI project apologized, recognizing the vulnerabilities of code which allowed hacking. “We will continue to work with diligence to protect our users and their assets, learning from this incident to improve our security posture,” promised the team.
But two months after the collapse of the protocol, the co-founders of Dough Finance apparently abandoned their customers to launch their new Crypto, WLFI project, alongside President Trump, and his three sons, Donald Jr., Eric and Barron.
After the announcement of their new Crypto Venture, online reports raised the alarm while the language in the White WLFI book disclosed would be “very similar” to that of Dough Finance.
The customers of the paste finance are left empty -handed
Reuters stressed that Folkman and Herro would have promised not to stop “until everyone is made whole” in a message to a telegram channel with 2,700 paste finance users.
Nevertheless, the co-founders of the DEFI protocol, apparently known to publish frequently online, would have developed to update the project telegram and X accounts after August 18 and removed another group of telegrams.
In addition, the paste finance website has been closed, and the project has only a total locked value (TVL) of $ 1,689, according to Defilma Data.
Dough Finance's TVL by May 19, 2025. Source: DeFiLlama
The report notes that an investor continued Herro in Florida for fraud, false declaration, violation of financial functions and violations of the securities law. The trial, filed on January 27, 2025, argues that Jonathan Lopez, a client of the finance of the dough, had invested nearly 300 ETH in the DEFI project based on the representations of Herro.
Ten victims also spoke to the information media on condition of anonymity, with a user claiming that they last heard paste finances four months ago, January 13, when they promised to “have a solution this week”, but never received a compensation.
According to Reuters, Herro and Folkman have achieved at least $ 65 million in their reduction in WLFI income, based on the sharedown shares of the product of the sale of more than $ 550 million in token.
Ethereum's performance in the one-week chart. Source: ETHUSDT on TradingView
Star image of Unsplash.com, tradingView.com graphic
Editorial process Because the bitcoinist is centered on the supply of in -depth, precise and impartial content. We confirm strict supply standards, and each page undergoes a diligent review by our team of high -level technology experts and experienced editors. This process guarantees the integrity, relevance and value of our content for our readers.
