Justin Sun, the founder of the Tron blockchain, has initiated a lawsuit against World Liberty Financial, a cryptocurrency firm with ties to the family of former U.S. President Donald Trump.
The lawsuit alleges that World Liberty Financial unfairly froze Sun's $WLFI token holdings, made false representations, and threatened and defamed him. According to the lawsuit, Sun purchased the $WLFI tokens after being solicited by the World Liberty team in 2024, investing $45 million.
The suit claims that World Liberty's leadership engaged in an illegal scheme to seize Sun's tokens and that the company's association with the Trump family was a factor in Sun's decision to invest. A spokesperson for World Liberty Financial declined to comment on the lawsuit. The filing states that World Liberty asked Sun to continue investing in 2025, including a request to mint the company's USD1 stablecoin.
However, when Sun refused to invest on their terms, World Liberty's principals became hostile towards him. The lawsuit alleges that World Liberty made fraudulent misrepresentations about the economic rights and liberties associated with purchasing $WLFI tokens, including statements about token holder rights and the freedom to transact. The suit also claims that World Liberty has centralized control over its tokens, despite presenting itself as a decentralized finance business. In August 2025, World Liberty modified the smart contract governing $WLFI to add a 'blacklisting' function, allowing the company to freeze tokens in specific wallets without disclosing this change to investors.
The complaint alleges that this modification was used to freeze Sun's tokens, serving the dual purpose of pressuring him to mint $200 million of the USD1 stablecoin on the Tron blockchain and manipulating the market price of $WLFI tokens. By locking up Sun's position, World Liberty allegedly artificially propped up the market price of $WLFI tokens held by the company's founders and treasury.
The lawsuit raises regulatory questions, suggesting that World Liberty's ability to issue, freeze, and reassign tokens may qualify it as a money transmitter under U.S. Financial Crimes Enforcement Network rules. Other allegations in the complaint include threats made by World Liberty's co-founder, Chase Herro, to burn Sun's $WLFI tokens and report him to U.S. authorities.
Sun has stated that he tried to resolve the situation in good faith and wants to be treated the same as other early investors who received tokens.