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 locked up his $WLFI token holdings, made false representations, and issued threats against him. The lawsuit, which was filed on Tuesday, claims that World Liberty's leadership engaged in an illegal scheme to seize Sun's tokens, which he had purchased after being approached by the company's team in 2024.
According to the lawsuit, Sun invested $45 million in $WLFI tokens due to the project's claims of promoting decentralized finance, an issue Sun is passionate about, as well as the Trump family's involvement with the project. A spokesperson for World Liberty Financial declined to comment on the lawsuit. The lawsuit 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 or mint the stablecoin on their terms, World Liberty's principals 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 rights, and the freedom to transact. Sun's lawsuit also alleges that World Liberty, despite presenting itself as a decentralized finance company, has 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 to investors. The lawsuit claims that World Liberty's freezing of Sun's tokens served two purposes: 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 that World Liberty artificially propped up the market price of $WLFI tokens held by the company's founders and treasury. The lawsuit also raises regulatory questions, arguing 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. Other allegations in the complaint include threats made by World Liberty's co-founder, Chase Herro, against Sun and his businesses. Herro allegedly threatened to burn Sun's $WLFI tokens if he did not request that they be burned and falsely claimed that the know-your-customer documentation submitted by Sun was inadequate, threatening to report him to US authorities.
Portions of the lawsuit were redacted, with Sun's team giving World Liberty the opportunity to decide whether these provisions should remain sealed. In a post, Sun stated that he had tried to resolve the situation in good faith and wanted to be treated the same as other early investors who received tokens. He also expressed opposition to World Liberty's new governance proposal published on April 15. Since Trump took office, Sun has visited the US after previously avoiding the country, and was a guest at Trump's first memecoin dinner last year.
Sun recently settled charges with the US Securities and Exchange Commission, agreeing to pay a $10 million fine to resolve a case brought by the previous presidential administration.