DWF-linked firms sue BitGo for $141 million over early token sales
Two firms tied to crypto market maker DWF Labs have sued BitGo for $141 million in London’s High Court, accusing the digital asset custodian of selling locked tokens months before an agreed unlock date. The case comes as a separate regulatory filing showed Trump-backed World Liberty Financial moving to strip BitGo of its role as custodian for the USD1 stablecoin.
- DWF Maas and Falcon Digital allege BitGo broke a three-month lockup on Falcon Finance (FF) and ESPORTS tokens bought at a discount.
- ESPORTS fell from about $0.28 in mid-March to $0.07 by early June, a roughly 75% decline the claimants blame on early sales.
- The Office of the Comptroller of the Currency gave World Liberty’s own trust company preliminary approval on August 14, 2026, to take over USD1 issuance and custody from BitGo.
- $141M lawsuit claim, nearly six times DWF Labs’ $25 million WLFI token stake
- $4.3B USD1 in circulation across Ethereum, BNB Chain, Solana and Tron
- Aug 14 date OCC approved a rival custodian to replace BitGo on USD1
BitGo is facing the $141 million suit after DWF Maas and Falcon Digital claimed the custodian moved their FF and ESPORTS tokens to exchanges roughly two months ahead of the first agreed unlock date, according to the Financial Times’ account of the filing. The case, filed Friday and mapped in detail by Cryptopolitan’s reporting, pulls together three firms that each sit inside President Donald Trump’s World Liberty Financial network. All three, the plaintiffs, the defendant and the stablecoin project connecting them, now face scrutiny over how tightly token lockups actually bind custodians in over-the-counter crypto deals.
DWF Maas and Falcon Digital Accuse BitGo of Dumping Tokens Early
The plaintiffs say they bought FF and ESPORTS tokens at a discount under a private OTC agreement carrying a three-month lockup and vesting schedule. They allege BitGo instead transferred the tokens to exchanges about two months before the first unlock date, presumably to sell them into thin markets.
Per the claimants’ account, FF traded around $0.08 in early March and had slipped to $0.07 by late April, a decline of roughly 12%. ESPORTS fell further and faster, from about $0.28 in mid-March to $0.07 by early June, a drop of close to 75%. DWF Maas and Falcon Digital argue BitGo’s sales into low-liquidity markets drove those declines, eroding the value of holdings they expected to remain locked for another two months.
DWF Labs’ $25M WLFI Bet Links the Plaintiffs and the Defendant
DWF Labs bought $25 million of WLFI governance tokens in April 2025 in what it called a strategic private transaction, pledging to supply liquidity for USD1. World Liberty followed with a $10 million investment into Falcon Finance in July 2025 to build conversions between its USDf stablecoin and USD1; USDf runs on DWF Labs’ own infrastructure, and DWF Labs and Falcon Finance share a founder, Andrei Grachev.
BitGo sits at the center of that network as the custodian for the reserves backing USD1, with roughly $4.3 billion of the stablecoin now circulating across Ethereum, BNB Chain, Solana and Tron. Trump’s broader business orbit has already flagged interest in st
