Tron founder Justin Sun has taken legal action against World Liberty Financial, a cryptocurrency firm with ties to the family of former US President Donald Trump, alleging that the company froze his $WLFI token holdings without justification, made false representations, and issued threats against him. The lawsuit, filed recently, asserts that World Liberty's actions constitute an 'illegal scheme to seize property' in the form of Sun's tokens, which he claims to have purchased after being approached by the company's team in 2024.
At the time of the investment, Sun was drawn to the project due to its purported focus on promoting decentralized finance, an issue close to his heart, as well as its association with the Trump family. According to the lawsuit, Sun invested $45 million in $WLFI tokens, motivated by the project's claims and the Trump family's involvement. A spokesperson for World Liberty Financial declined to comment on the lawsuit.
The filing alleges that World Liberty asked Sun to continue investing in 2025, including a request to mint the company's USD1 stablecoin. However, when it became clear that Sun would not invest on their terms, 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.' Sun's suit also alleges that World Liberty, despite presenting itself as a decentralized finance business, exercised centralized control over its tokens.
The complaint states that World Liberty modified the smart contract governing $WLFI in August 2025 to add 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, serving a dual purpose: pressuring him to mint $200 million of the company's USD1 stablecoin on the Tron blockchain and manipulating the market price of $WLFI tokens by preventing one of the largest holders from selling. By locking up Sun's position, the complaint argues, World Liberty artificially supported the market price of $WLFI tokens held by the company's founders and treasury. The filing 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, subjecting it to registration and anti-money laundering requirements.
The lawsuit also alleges that World Liberty made threats against Sun and his businesses, including a claim by co-founder Chase Herro that he would burn Sun's $WLFI tokens if Sun did not request that they be burned. Herro allegedly threatened to report Sun to US authorities, citing inadequate know-your-customer documentation. Portions of the lawsuit have been redacted, with an attached filing citing a confidentiality provision and offering the World Liberty team the opportunity to decide whether these provisions should remain sealed.
In a social media 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. Since Trump's presidency, Sun has visited the US after previously avoiding the country and was a guest at a Trump-linked crypto project dinner last year. Recently, Sun settled charges with the US Securities and Exchange Commission, agreeing to pay a $10 million fine to resolve a case brought by the previous administration.