Justin Sun, the founder of Tron, has taken legal action 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 and made false representations, in addition to threatening and defaming 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 association with the Trump family and its claims of promoting decentralized finance. 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 economic rights and liberties associated with purchasing $WLFI tokens, including statements about token holder rights and the freedom to transact. It is also claimed that World Liberty, despite presenting itself as a decentralized finance business, has centralized control over its tokens. The company is accused of modifying the smart contract governing $WLFI in August 2025 to add a 'blacklisting' function, which allowed it to freeze tokens in specific wallets without disclosing this to investors. The lawsuit argues that this modification was used to freeze Sun's tokens, both to pressure him into minting $200 million of the USD1 stablecoin on the Tron blockchain and to manipulate the market price of $WLFI tokens.
By locking up Sun's position, World Liberty allegedly propped up the market price of $WLFI tokens held by its 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 US Financial Crimes Enforcement Network rules.
Other allegations include threats made by World Liberty co-founder Chase Herro to burn Sun's $WLFI tokens and to report him to US authorities over allegedly inadequate know-your-customer documentation. A spokesperson for World Liberty Financial stated that the company had no comment on the lawsuit. In a post, Sun expressed his desire to be treated equally to other early investors and opposed a new governance proposal published by World Liberty.