Justin Sun, the founder of Tron, has initiated a lawsuit against World Liberty Financial, a cryptocurrency firm with ties to the family of former US President Donald Trump. The lawsuit, filed on Tuesday, alleges that World Liberty Financial engaged in an illegal scheme to seize Sun's $WLFI tokens, which he claims to have purchased after being solicited by the company in 2024.
Sun invested $45 million in the tokens, reportedly due to the project's claims of promoting decentralized finance and its association with the Trump family. However, when Sun declined to continue investing in 2025, including a request to mint the company's USD1 stablecoin, World Liberty's principals allegedly became hostile towards him.
The lawsuit accuses World Liberty of making fraudulent misrepresentations about the economic rights and liberties associated with purchasing $WLFI tokens, including statements about token holder rights and the freedom to transact. Sun's suit also claims that World Liberty, despite presenting itself as a decentralized finance business, has centralized control over its tokens. According to the complaint, World Liberty modified the smart contract governing $WLFI in August 2025 to add a 'blacklisting' function, allowing the company to freeze tokens in specific wallets without disclosing this change to investors. The lawsuit alleges that this modification was used to freeze Sun's tokens, serving a dual purpose: pressuring him to mint $200 million of the company's USD1 stablecoin on the Tron blockchain and manipulating the market price of $WLFI tokens.
By locking up Sun's position, the complaint argues, World Liberty artificially propped up the market price of $WLFI tokens held by the company's founders and treasury. The filing also raises regulatory questions, suggesting that World Liberty's ability to issue, freeze, and reassign tokens may qualify it as a money transmitter under US Financial Crimes Enforcement Network rules.
Other allegations in the complaint include threats made by World Liberty's co-founder, Chase Herro, against Sun and his businesses. Herro allegedly threatened to burn Sun's $WLFI tokens and report him to US authorities, claiming that the know-your-customer documentation submitted by Sun was inadequate.
The lawsuit includes redacted provisions, with Sun's team giving World Liberty the opportunity to decide whether these provisions should remain sealed. In a post, Sun stated that he had tried to resolve the situation in good faith and sought to be treated equally to other early investors.
He also expressed opposition to World Liberty's new governance proposal, published on April 15. This development comes after Sun settled charges with the US Securities and Exchange Commission last month, agreeing to pay a $10 million fine to resolve a case brought by the previous presidential administration.