Two companies tied to crypto market maker DWF Labs are seeking $141 million from custodian BitGo in London's High Court, alleging the firm sold locked-up tokens roughly two months before their scheduled unlock in breach of a private over-the-counter agreement.

DWF Maas and Falcon Digital filed the suit, the Financial Times reported Friday. The dispute centers on tokens from Falcon Finance (FF) and ESPORTS, which BitGo acquired at a discount in exchange for a commitment not to sell before lock-up and vesting periods expired, according to the report. BitGo instead moved the tokens to exchanges early.

What do the plaintiffs allege happened?

DWF Maas and Falcon Digital argue that BitGo's early sales hit a thin market and created heavy downward pressure, eroding the value of the tokens the DWF-affiliated firms still held. The firms say they raised the issue with BitGo in April and May of this year, seeking assurances, and turned to litigation only after the custodian declined to provide them.

The core claim is contractual. Under the private OTC deal, the discount BitGo received on the tokens was the consideration for accepting vesting restrictions. Selling before the first unlock, the plaintiffs contend, stripped that bargain of its meaning and damaged their remaining positions.

BitGo declined to comment, according to the report. The allegations remain untested in court, and BitGo has not yet publicly responded to the substance of the claims.

Who are the parties?

The case pits two institutional players against each other, each with significant operational footprints in crypto market structure.

BitGo ranks among the industry's largest custodians, holding roughly $5 billion in assets under custody. The company listed on the New York Stock Exchange this year at a valuation of around $2 billion and recently acquired NYDIG's institutional trading arm, extending its reach across custody and execution.

DWF Labs, headquartered in Dubai, operates as a market maker and investor across a wide range of token projects. DWF Maas and Falcon Digital are affiliated entities within that structure.

A shared connection runs through the dispute: both sides have ties to World Liberty Financial, the Trump-family-backed crypto venture. DWF Labs purchased $25 million of World Liberty's WLFI token last year, while BitGo custodies the reserves backing the project's USD1 stablecoin — a role World Liberty now plans to take over through its own newly approved trust bank.

What are the operational stakes?

For BitGo, the suit cuts at the trust foundation of its core business. Custodians win institutional mandates on the premise that they hold assets under agreed terms and do not trade against clients. An allegation that BitGo sold discounted, contractually locked tokens — even if unproven — invites counterparty diligence questions from funds and projects negotiating custody and vesting arrangements.

For market makers and token issuers, the case tests how effectively private OTC lock-up terms can be enforced when a counterparty breaches them. Early sales into illiquid books are a recurring friction point in token deals, and litigation in a major commercial court signals that firms increasingly treat those commitments as enforceable financial obligations rather than soft understandings.

The proceedings are at an early stage in London's High Court, and no trial date or disclosure timeline has been set. The outcome will shape how OTC token agreements allocate custody risk — and whether discount-for-lock-up structures remain standard for custodians participating in private token deals.