ALT5 Sigma Corporation (ALTS) shares plunged 12.44% in pre-market trading on Tuesday, following a 5.6% drop in the previous session. The sharp decline comes in the wake of a disappointing debut for the World Liberty Financial (WLFI) token, a cryptocurrency project backed by former U.S. President Donald Trump and his family.

The WLFI token, which began trading on Monday, fell 25% to approximately $0.21 on its first day. This poor performance has had a ripple effect on ALT5 Sigma, which is closely tied to the project. ALT5 Sigma recently announced plans to raise $1.5 billion, with half of that amount to be paid in WLFI tokens, to establish a "crypto treasury" that will hold WLFI tokens.

Investors appear to be reacting negatively to this connection, as the WLFI token's struggles cast doubt on the viability of ALT5 Sigma's crypto treasury plans. The situation is reminiscent of other companies that have transformed into crypto proxy stocks, raising concerns about the potential risks and volatility associated with such strategies. As the market continues to digest these developments, ALT5 Sigma shareholders may face further uncertainty in the coming trading sessions.