A public feud between Justin Sun, founder of Tron, and WLFI, a crypto project linked to the Trump family, has intensified after Sun vehemently criticized a newly introduced governance proposal. Sun described the proposal as 'one of the most absurd governance scams' he has encountered, stating that it is designed to punish token holders who vote against it by locking their tokens indefinitely.
He also claimed that he and other major token holders were excluded from the voting process, with approximately 4% of the voting power under his control being frozen. Furthermore, Sun questioned the legitimacy of the vote, suggesting that control over the protocol lies with anonymous wallet addresses, including a multisignature setup that can override outcomes and a separate account capable of blacklisting users. Sun argued that the proposal is not a genuine governance effort but rather an attempt by a select few to consolidate power and expropriate property. The proposal in question aims to overhaul token lockups across the WLFI ecosystem, subjecting over 62 billion tokens to new terms, including multi-year lockups and vesting schedules.
Insiders, such as team members, advisors, and partners, would face a two-year lockup followed by a three-year gradual release, along with a 10% token burn upon opting in. Early supporters would have slightly shorter vesting terms but no burn, with up to 4.5 billion tokens potentially being permanently destroyed. Token holders who do not accept the new terms would remain locked indefinitely.
Simon Dedic, founder of Moonrock Capital, shared similar concerns, stating that early investors had been 'rugged' by the Trump family themselves. 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, ensuring optimal long-term participation and healthy market supply. The backlash marks the latest episode in the deteriorating relationship between Sun and the project, which has been escalating over the past few months.
Earlier this week, WLFI threatened legal action against Sun, who had accused the team of exploiting users through DeFi transactions. The dispute began in September when WLFI blacklisted a blockchain address linked to Sun, which held approximately $107 million worth of governance tokens at the time. Tensions intensified after WLFI deposited 5 billion of its tokens into a lending protocol and borrowed roughly $75 million in stablecoins, prompting Sun to accuse the project of treating users as 'personal ATMs', which led to the latest legal threats.