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 claims that World Liberty unfairly froze Sun's $WLFI token holdings, made false representations, and issued threats against him. According to the lawsuit, Sun had invested $45 million in $WLFI tokens after being approached by the World Liberty team in 2024, partly due to the project's connection to the Trump family. However, when Sun declined to continue investing in 2025, including a request to mint World Liberty's USD1 stablecoin, the company's leadership allegedly became hostile towards him.
The lawsuit alleges that World Liberty induced Sun to invest through fraudulent misrepresentations about the economic rights and liberties associated with purchasing $WLFI tokens. These misrepresentations included statements about token holder rights, governance rights, and the freedom to transact. The lawsuit also claims that World Liberty, despite presenting itself as a decentralized finance business, exercised centralized control over its tokens.
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 company's USD1 stablecoin 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, subjecting it to registration and anti-money laundering requirements. Other allegations include threats made by World Liberty's co-founder, Chase Herro, to burn Sun's $WLFI tokens and to report him to US authorities over allegedly inadequate know-your-customer documentation.
Portions of the lawsuit have been redacted, with Sun's team giving World Liberty the opportunity to decide whether these provisions should remain sealed. In a public post, Sun stated that he had attempted to resolve the situation in good faith and sought equal treatment as other early investors. He also expressed opposition to a new governance proposal published by World Liberty on April 15.