A public feud between Tron founder Justin Sun and the Trump-linked cryptocurrency project WLFI escalated on Wednesday, with Sun strongly condemning a new governance proposal. In a post, Sun described the proposal as 'one of the most absurd governance scams' he has encountered, alleging that it is designed to punish token holders who vote against it by locking their tokens indefinitely. Sun also claimed that he and other major holders were excluded from the voting process, stating that tokens representing around 4% of the voting power under his control had been frozen.
Furthermore, Sun questioned the legitimacy of the vote, suggesting that control over the protocol rests with anonymous wallet addresses, including a multisignature setup that can override outcomes and a separate account with the power to blacklist users. The proposal in question aims to overhaul token lockups across the WLFI ecosystem, with over 62 billion tokens subject to new terms, including multi-year lockups and vesting schedules. Insiders, such as team members and advisors, would face a two-year lockup followed by a three-year gradual release, alongside a 10% token burn upon opting in. Holders who do not accept the new terms would remain locked indefinitely.
Sun's criticism was not isolated, as Simon Dedic, founder of Moonrock Capital, also expressed opposition, stating that early investors had been 'rugged' by the proposal. A spokesperson for World Liberty Financial defended the proposal, saying it was designed to align all participants in the WLFI ecosystem for the long term and ensure healthy market supply. The backlash marks the latest episode in the deteriorating relationship between Sun and the project, which has been building for months. Earlier this week, WLFI threatened legal action against Sun, who had accused the team of exploiting users through DeFi transactions.
The dispute has its roots in September, when WLFI blacklisted a blockchain address linked to Sun, and has intensified since then, with tensions rising after WLFI deposited its own tokens into a lending protocol and borrowed stablecoins, triggering a significant decline in token value.