Tron founder Justin Sun has taken legal action 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, claims that World Liberty's leadership engaged in an 'illegal scheme to seize property' in the form of Sun's tokens, which he had purchased after being approached by the company in 2024. According to the suit, Sun invested $45 million in $WLFI tokens due to the project's purported commitment to promoting decentralized finance, a cause close to his heart, as well as its association with the Trump family.
A spokesperson for World Liberty Financial declined to comment on the lawsuit. The filing states that World Liberty asked Sun to continue investing in 2025, including a request to mint the company's USD1 stablecoin. However, when it became clear that Sun would not invest or mint USD1 on their terms, World Liberty'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, governance, and the 'freedom to transact'. Sun's suit also alleges that World Liberty, despite presenting itself as a decentralized finance business, exerted centralized control over its tokens. According to the complaint, 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 or putting it to a governance vote. The complaint argues that World Liberty's freezing of Sun's tokens served two purposes: pressuring him to mint $200 million of the company's USD1 stablecoin on his Tron blockchain and manipulating $WLFI's market price by preventing one of the largest holders from selling.
By locking up Sun's position, the complaint claims, World Liberty artificially supported the market price of $WLFI tokens held by the company's founders and treasury. The lawsuit raises regulatory questions, 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 include threats made by World Liberty co-founder Chase Herro against Sun and his businesses, including a claim that Sun's know-your-customer documentation was inadequate and a threat to report him 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. He also expressed opposition to a new governance proposal published by World Liberty on April 15.
This development comes after Sun settled charges with the US Securities and Exchange Commission last month, agreeing to pay a $10 million fine to resolve a case brought by the previous presidential administration.