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 threatened and defamed 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 association with 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 liberties associated with purchasing $WLFI tokens, including statements about token holder governance rights and the freedom to transact.
Sun's suit also claims that World Liberty, despite presenting itself as a decentralized finance business, has centralized control over its tokens. The company allegedly modified the smart contract governing $WLFI in August 2025 to add a 'blacklisting' function, allowing it to freeze tokens in specific wallets without disclosing this to investors. The complaint argues that this modification enabled World Liberty to freeze Sun's tokens, serving a dual purpose: 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 its founders and corporate 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 US Financial Crimes Enforcement Network rules. Other allegations include threats made by World Liberty's co-founder, Chase Herro, to burn Sun's $WLFI tokens and report him to US authorities for allegedly inadequate know-your-customer documentation. Sun has stated that he attempted to resolve the situation in good faith and seeks to be treated equally to other early investors who received tokens.