DWF Labs subsidiaries are suing crypto custodian BitGo in London's High Court for $114 million in damages, alleging BitGo sold Falcon Finance (FF) and ESPORTS tokens at a discount roughly two months before a contractual three-month lock-up expired, the Financial Times reported Friday.

DWF Maas, a British Virgin Islands entity, and Falcon Digital, registered in Panama, claim they negotiated discounted private sales of the two tokens to BitGo on the condition that the buyer hold them for three months. Both companies allege BitGo transferred the assets to exchanges ahead of schedule, depressing the secondary price and producing direct losses on the discount-priced holdings.

What are the specific allegations?

According to the lawsuit and DWF's account reported by the FT, FF fell from 8 cents at the start of the lock-up in early March to around 7 cents by late April. ESPORTS declined from about 28 cents in mid-March to 7 cents in early June. The plaintiffs argue BitGo's early sales caused those moves.

DWF attributed the following statement to its counsel: "The discount BitGo received was conditional on the tokens remaining locked, and they were moved to exchanges roughly two months before the first unlock."

A second statement said: "We raised this with BitGo in April and May, and with no undertaking forthcoming, court action became necessary."

The claim, dated within recent weeks, names BitGo as defendant and seeks $114 million in damages tied to the alleged breach of the private-sale contracts. DWF told the FT it attempted to resolve the dispute informally for roughly two months before filing.

Why does the lock-up matter operationally?

Private token sales with multi-month lock-up periods are a standard structuring tool in digital-asset capital formation. Issuers and intermediaries sell at a discount in exchange for the buyer's commitment not to liquidate immediately, which protects order books at listing and limits post-unlock supply. A breach of that covenant by a major counterparty such as a qualified custodian is a credit and market-integrity event, not merely a contract dispute, since the discount price itself was set on the locked-up premise.

What is the broader context around DWF?

The plaintiffs are units of DWF Labs, the Dubai-headquartered market maker led by founder and managing partner Andrei Grachev. DWF Labs purchased $25 million of WLFI tokens last year, the governance token of World Liberty Financial, the crypto project associated with President Donald Trump and his family. That investment drew concern from some U.S. lawmakers over Grachev's prior role as chief executive of Huobi's Russian business between 2018 and 2019; Huobi entities have faced sanctions in several jurisdictions for activity linked to Russian sanctions evasion. Grachev has previously denied wrongdoing.

BitGo, founded in 2013 and based in Palo Alto, is one of the largest qualified custodians serving institutional crypto clients. The case is filed in the Commercial Court, the specialist division of the High Court that handles complex commercial disputes including financial-services contracts.

What happens next?

BitGo had not publicly responded to the claims at the time of the FT report. Standard case management directions in the Commercial Court would typically set a timetable for the defendant's response, disclosure, and any strike-out application over the coming months. A first hearing on procedural matters is likely within weeks; a full trial, if the matter proceeds, would run on a longer horizon. Either side may seek to settle, particularly given the reputational exposure for a custodian whose core business depends on demonstrating reliable safekeeping of client and counterparty assets.