A heated public dispute between Justin Sun, founder of Tron, and WLFI, a crypto project linked to Trump, escalated on Wednesday. Sun strongly condemned a new governance proposal by WLFI, labeling it as 'one of the most absurd governance scams' he has encountered. In a detailed post, Sun accused WLFI of designing a vote that punishes those who dissent, with token holders who oppose the proposal risking indefinite token lockups.
He also alleged that he and other major holders had been excluded from the voting process, stating that tokens representing approximately 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. Sun stated, 'This proposal is not governance, it's an exercise of power by a select few who are carefully engineering a further power consolidation and property expropriation operation.' The criticism revolves around WLFI's proposal to overhaul token lockups across the ecosystem, affecting over 62 billion WLFI tokens with new terms, including multi-year lockups and vesting schedules. Under the plan, tokens held by insiders, such as team members, advisors, and partners, would face a two-year lockup followed by a three-year gradual release, alongside a 10% token burn upon opting in.
Early supporters would face slightly shorter vesting terms but no burn, with up to 4.5 billion tokens potentially being permanently destroyed. Holders who do not accept the new terms would remain locked indefinitely, according to the proposal.
Sun was not alone in his criticism, as Simon Dedic, founder of Moonrock Capital, expressed that early investors had been 'rugged' by the Trump family themselves. A World Liberty Financial spokesperson countered that the proposal was designed to align all participants in the WLFI ecosystem for the long term, ensuring long-term participation and a healthy market supply. This backlash marks the latest episode in the deteriorating relationship between Sun and the project, which has been escalating over months, including a recent threat of legal action and a sharp reversal from late 2024 when Sun was a key backer of WLFI.