Justin Sun, the founder of Tron, has initiated a lawsuit against World Liberty Financial, a cryptocurrency firm with ties to the family of former U.S. President Donald Trump.
The lawsuit, filed on Tuesday, 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 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 became hostile towards him.
The lawsuit alleges that World Liberty induced Sun to invest through fraudulent misrepresentations about the economic rights and liberties associated with purchasing $WLFI tokens. These misrepresentations include statements about token holder rights, governance rights, and the freedom to transact.
The lawsuit also claims that World Liberty, despite presenting itself as a decentralized finance business, has centralized control over its tokens. In August 2025, World Liberty modified the smart contract governing $WLFI to add a 'blacklisting' function, allowing the company to freeze tokens in specific wallets without disclosing this change to investors.
The complaint alleges that this modification was used to freeze Sun's tokens, serving the dual purpose of 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 the company's founders and treasury.
The lawsuit raises regulatory questions, as World Liberty's ability to issue, freeze, and reassign tokens may qualify it as a money transmitter, subjecting it to registration and anti-money laundering requirements. Other allegations include threats made by World Liberty's co-founder, Chase Herro, to burn Sun's $WLFI tokens and report him to U.S. authorities over allegedly inadequate know-your-customer documentation.
A spokesperson for World Liberty Financial stated that the company had no comment on the lawsuit. Sun has expressed his desire to be treated equally to other early investors and has opposed a new governance proposal published by World Liberty.
This development comes after Sun settled charges with the U.S. Securities and Exchange Commission last month, agreeing to pay a $10 million fine.