Justin Sun, the founder of Tron, has initiated a lawsuit against World Liberty Financial, a cryptocurrency firm with ties to the Trump family, alleging that his $WLFI token holdings were unfairly frozen. The lawsuit claims that World Liberty made fraudulent representations and threatened Sun after he declined to continue investing in the project. According to the filing, Sun had invested $45 million in $WLFI tokens in 2024, partly due to the project's association with the Trump family.
However, when Sun refused to invest further, including a request to mint World Liberty's USD1 stablecoin, the company's principals became hostile towards him. The lawsuit alleges that World Liberty modified the smart contract governing $WLFI in August 2025, adding a 'blacklisting' function that allowed the company to freeze tokens without disclosing this change to investors. This modification enabled World Liberty to freeze Sun's tokens, which the lawsuit claims was done to pressure him into minting $200 million of the company's USD1 stablecoin and to manipulate the market price of $WLFI tokens.
The complaint also raises regulatory concerns, suggesting that World Liberty's ability to issue, freeze, and reassign tokens may qualify it as a money transmitter, subjecting it to registration and anti-money laundering requirements. Furthermore, the lawsuit alleges that World Liberty made threats against Sun and his businesses, including a claim that the company's co-founder, Chase Herro, threatened to burn Sun's $WLFI tokens and report him to U.S. authorities. In response to the lawsuit, a spokesperson for World Liberty Financial stated that the company had no comment.
Sun has expressed his desire to be treated equally to other early investors and has opposed a new governance proposal published by World Liberty. This development comes after Sun settled charges with the U.S. Securities and Exchange Commission last month, agreeing to pay a $10 million fine.