The Trump family’s World Liberty Financial crypto project is drawing sharp criticism after its treasury used billions of its own WLFI governance tokens as collateral to borrow stablecoins on an affiliated DeFi lending platform. The structure has prompted comparisons to the circular borrowing that contributed to the collapse of crypto exchange FTX in 2022.

According to CoinDesk, World Liberty Financial’s treasury wallet has routed roughly five billion WLFI tokens to a crypto lending protocol, Dolomite. The project borrowed about $75 million in stablecoins, including $65.4 million of its own USD1 and $10.3 million in USDC. More than $40 million of the proceeds later moved to Coinbase Prime. The activity pushed…