A highly publicized disagreement between Tron founder Justin Sun and the Trump-associated cryptocurrency project WLFI has escalated, with Sun criticizing a newly introduced governance proposal as a 'governance scam'. Sun expressed his concerns on X, stating that the proposal would result in token lockups for holders who vote against it and exclusion from voting for large holders.
He further alleged that tokens worth about 4% of the voting power under his control had been frozen. Sun questioned the legitimacy of the vote, suggesting that control over the protocol lies with anonymous wallet addresses, including a multisignature setup capable of overriding outcomes and an account with the power to blacklist users.
The proposal in question seeks to overhaul token lockups across the WLFI ecosystem, affecting over 62 billion tokens with new lockup terms, including multi-year lockups and vesting schedules. Insiders, such as team members and partners, would face a two-year lockup followed by a three-year gradual release, along with a 10% token burn for opting in.
Holders who do not accept the new terms would remain locked indefinitely. Other critics, including Moonrock Capital founder Simon Dedic, have joined Sun in pushing back against the proposal, describing it as an attempt to 'rug' early investors. A spokesperson for World Liberty Financial defended the proposal, stating it was designed to align participants in the WLFI ecosystem for the long term, ensuring healthy market supply. The backlash marks the latest episode in the deteriorating relationship between Sun and the project, with tensions building over months and recent threats of legal action.