tl;dr
World Liberty Financial (WLFI) co-founders Chase Herro and Zak Folkman have not reimbursed clients of their previous startup, Dough Finance, following a $2.5 million hack in July 2024 that led to Dough's closure. Despite Dough's community voting overwhelmingly to compensate token holders, only a par...
World Liberty Financial (WLFI) co-founders Chase Herro and Zak Folkman have yet to reimburse clients following a $2.5 million hack at their previous startup, Dough Finance, which led to its closure in July 2024. Despite Dough Finance’s community voting overwhelmingly to compensate token holders, only a partial recovery was made, with reimbursements delivered mainly in nearly worthless DOUGH tokens.
Herro is currently facing a lawsuit filed by a former Dough investor, Jonathan Lopez, aiming to recover lost assets. Importantly, the lawsuit targets Herro personally, with no allegations or involvement directed at Folkman, WLFI, or the Trump family, despite WLFI’s association with them.
After the breach, Dough Finance acknowledged the hack and recovered approximately $280,000, distributing about $180,000 to some creditors. However, since launching WLFI with Zack Witkoff, the founders have not advanced reimbursement efforts, raising questions given WLFI’s financial success and recent $3 million investment in EOS tokens—an amount exceeding the hack losses.
WLFI has grown rapidly, boasting a market cap over $2 billion and attracting significant political and investment attention. This contrasts sharply with the unresolved repayments to Dough investors, a discrepancy highlighted by the pending lawsuit. The trial is scheduled for April 2026, but an out-of-court settlement remains a hopeful outcome.
Despite WLFI’s prominence, the reimbursement remains in limbo, with Dough token holders left holding near-worthless assets. The case underscores the complexities that can follow crypto startup breaches and raises broader questions about accountability and investor protections in the evolving digital finance landscape.
Will the WLFI co-founders resolve the dispute amicably before the trial? How should investors navigate trust and risk when past controversies shadow promising new ventures? These questions linger as the crypto community watches closely.