Tron founder Justin Sun has initiated a lawsuit against World Liberty Financial, a cryptocurrency firm with ties to the family of former US President Donald Trump, alleging that the company froze his $WLFI token holdings without justification, made false representations, and issued threats against him. The lawsuit, filed on Tuesday, asserts that World Liberty's actions constitute an 'illegal scheme to seize property' in the form of Sun's tokens, which he claims to have purchased after being solicited by the company in 2024.
Sun invested $45 million in $WLFI tokens, reportedly due to the project's potential to promote decentralized finance and its association with the Trump family. A spokesperson for World Liberty Financial declined to comment on the lawsuit. According to the filing, World Liberty requested that Sun continue investing in the project through 2025, including a proposal to mint the company's USD1 stablecoin. However, when Sun refused to invest on their terms, the company's principals allegedly 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 and the freedom to transact. Sun's suit also alleges that World Liberty, despite presenting itself as a decentralized finance company, exercises 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 change to investors.
This modification was made without a governance vote, even as token holders had approved a proposal to make a portion of the token supply tradable. The lawsuit argues that World Liberty's freezing of Sun's tokens served two purposes: to pressure him into minting $200 million of the company's USD1 stablecoin on the Tron blockchain and to manipulate the market price of $WLFI tokens by preventing one of the largest holders from selling.
By locking up Sun's position, the complaint claims that World Liberty artificially inflated the market price of $WLFI tokens held by the company's founders and treasury. The lawsuit also raises regulatory concerns, suggesting 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 co-founder Chase Herro against Sun and his businesses, including a threat to burn Sun's $WLFI tokens and a claim that Sun's know-your-customer documentation was inadequate.
Herro allegedly threatened to report Sun to US authorities. Portions of the lawsuit have been redacted, with Sun's team giving World Liberty the opportunity to decide whether these provisions should remain sealed.
In a social media post, Sun stated that he had attempted to resolve the situation in good faith and sought equal treatment as other early investors who received tokens. He also expressed opposition to a new governance proposal published by World Liberty on April 15.
Sun has 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.