Justin Sun, the founder of Tron, 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, filed on Tuesday, 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 solicited by World Liberty's 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 principals allegedly became hostile towards him. The lawsuit alleges that World Liberty made fraudulent misrepresentations about the rights and freedoms associated with purchasing $WLFI tokens, including statements about governance rights and the ability to transact freely. Furthermore, the lawsuit claims that World Liberty exerted centralized control over its tokens, contrary to its decentralized finance ethos.
In August 2025, World Liberty modified the smart contract governing $WLFI to introduce a 'blacklisting' function, allowing the company to freeze tokens in specific wallets without disclosing this change to investors or putting it to a governance vote. The lawsuit argues that this modification enabled World Liberty to freeze Sun's tokens, which served the dual purpose of pressuring him to mint $200 million of the company's USD1 stablecoin on the Tron blockchain and artificially propping up the market price of $WLFI tokens held by World Liberty's founders and corporate treasury.
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 under U.S. Financial Crimes Enforcement Network rules, subjecting it to registration and anti-money laundering requirements. Additionally, the lawsuit alleges that World Liberty made overt threats to Sun and his businesses, including a threat to burn his $WLFI tokens and a claim that his know-your-customer documentation was inadequate, with a warning to report him to U.S.
authorities. A spokesperson for World Liberty Financial declined to comment on the lawsuit. In a social media post, Sun stated that he had attempted to resolve the situation amicably and sought equal treatment as other early investors who received tokens.
He also expressed opposition to a new governance proposal published by World Liberty on April 15.