DWF Labs Units Take BitGo to London Court Over $141 Million Token Lock-Up Dispute

Two companies tied to market maker DWF Labs have taken custodian BitGo to London's High Court in a $141 million claim. They say BitGo sold tokens it bought at a discount long before the lock-up ended and sent their price lower. The Financial Times reported the case on Friday.

What BitGo is accused of

The claimants are DWF Maas, registered in the British Virgin Islands, and Panama-based Falcon Digital. Both sit inside DWF Labs, which operates from Dubai and is known as an active market maker and investor in the token market. The defendant, BitGo, is one of the largest custodians in the industry.

A lock-up means the recipient of the tokens may not sell them for an agreed period. Vesting spreads the unlock over several stages so that large volumes do not hit the market at the same time. Both mechanisms are written into the contract, and the claimants say BitGo ignored them.

According to the claimants, they sold BitGo Falcon Finance (FF) and ESPORTS tokens in a private over-the-counter deal. The buyer got a discount but agreed not to sell until the lock-up and vesting periods ran out. CoinDesk reports the lock-up lasted three months.

Yet DWF says BitGo moved the tokens to exchanges roughly two months before the first unlock. Selling into an illiquid market, the claimants argue, put heavy pressure on the price and cut the value of the share they kept for themselves.

The claimants also stress that the discount was payment for patience. Had the buyer been free to sell at once, the seller would not have accepted that price. In their view the early sales broke the logic of the deal itself, not just its formal terms.

How prices moved during the lock-up

Private token sales with a discount and a resale ban are common. Projects and large holders use them to raise capital without worrying that the buyer will dump everything on the market at once.

For the buyer, the discount pays for risk: the tokens sit idle for months, and the price can fall in the meantime. If the buyer sells early, it keeps the discount and pushes the drop onto the seller, who is left holding the rest of the tokens.

The price path CoinDesk cites is easy to read in numbers. FF slipped from 8 cents in early March, when the lock-up began, to 7 cents by late April. ESPORTS traded near 28 cents in mid-March and was at 7 cents in early June, a drop of about 75%. For FF every cent counts: a one-cent fall from 8 cents is 12.5% of its value.

For thin tokens like FF and ESPORTS even a moderate sale moves the price noticeably. That rarely happens with Bitcoin or Ethereum, whose markets absorb far larger volumes. DWF builds its position on exactly this selling pressure.

The size of the dispute and each side's position

Decrypt puts the dispute at $141 million. CoinDesk's headline carries the same figure, while the body of its article speaks of $114 million in losses that DWF demands. The court filing will show the exact amount of the claim.

DWF says it raised the issue with BitGo in April and May. It got no assurances in return, so it went to court. The company set out its position in a statement to the Financial Times, which the paper quoted verbatim.

"The discount BitGo received was conditional on the tokens remaining locked, and they were moved to exchanges roughly two months before the first unlock."

- DWF, statement to the Financial Times, October 9, 2026

BitGo declined to comment on the suit. The allegations have not been tested in court.

The profile of the defendant looks like this.

• BitGo holds roughly $5 billion in client assets.
• The company listed on the NYSE this year at a valuation near $2 billion.
• It recently bought the institutional trading arm of NYDIG.

Both sides have ties to World Liberty Financial, the crypto project backed by the Trump family. DWF bought $25 million of WLFI tokens last year, and BitGo holds the reserves behind the USD1 stablecoin. World Liberty is now moving that role to its own newly approved trust bank.

The suit itself has nothing to do with that link. Still, DWF's WLFI investment drew concern from some US lawmakers at the time, CoinDesk notes, so any news about the company gets extra attention.

What comes next in court

The High Court in London is hearing the case, and no hearing dates appear in the coverage. DWF wants damages, and BitGo has not set out its version in public. The company's shares (BTGO) closed Friday at about $7.3.

Decrypt writes that two large institutional players have collided. One is a market maker working with many tokens, the other a custodian with billions in assets under custody. The outcome could change how contracts for over-the-counter sales spell out the custodian's duties.