Justin Sun, the founder of Tron, has initiated a lawsuit against World Liberty Financial, a cryptocurrency and stablecoin firm with ties to the family of former U.S. President Donald Trump.
The lawsuit, filed on Tuesday, accuses World Liberty of unfairly freezing Sun's $WLFI token holdings, making fraudulent representations, and issuing threats and defamation against him. According to the lawsuit, Sun had invested $45 million in $WLFI tokens after being solicited by the World Liberty team in 2024, partly due to the project's connection to the Trump family and its claims of promoting decentralized finance adoption. 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 claims that World Liberty made fraudulent misrepresentations about the economic rights and liberties associated with purchasing $WLFI tokens, including statements about token holder rights, governance, and the freedom to transact. It is also alleged that World Liberty, despite presenting itself as a decentralized finance business, exerted centralized control over its tokens. In August 2025, the company modified the smart contract governing $WLFI to add a 'blacklisting' function, allowing it to freeze tokens in specific wallets without disclosing this change to investors or putting it to a governance vote.
The complaint argues that this modification enabled World Liberty 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 artificially propping up the market price of $WLFI tokens held by the company's founders and treasury. This ability to issue, freeze, and reassign tokens may not only undermine World Liberty's decentralization claims but also raise regulatory concerns, potentially subjecting the firm to registration and anti-money laundering requirements as a money transmitter. The lawsuit also includes allegations of threats made by World Liberty's co-founder, Chase Herro, against Sun and his businesses, including a threat to burn Sun's $WLFI tokens and a claim that Sun's know-your-customer documentation was inadequate, with a threat to report him to U.S.
authorities. 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.