Justin Sun, the founder of Tron, has filed a lawsuit against World Liberty Financial, a cryptocurrency firm backed by members of former US President Donald Trump's family. The lawsuit alleges that World Liberty Financial froze Sun's $WLFI token holdings and made fraudulent representations, in addition to threatening and defaming him.
According to the lawsuit, Sun had invested $45 million in $WLFI tokens after being solicited by the World Liberty team in 2024, partly due to the project's claims of promoting decentralized finance and its association with the Trump family. However, when Sun refused to continue investing in 2025, including a request to mint World Liberty's USD1 stablecoin, the company's principals allegedly became hostile towards him.
The lawsuit claims that World Liberty Financial induced Sun to invest through fraudulent misrepresentations about the economic rights and liberties associated with purchasing $WLFI tokens. These misrepresentations allegedly included statements about token holder rights, governance rights, and the freedom to transact.
The lawsuit also alleges that World Liberty Financial, despite presenting itself as a decentralized finance business, has centralized control over its tokens. In August 2025, the company modified the smart contract governing $WLFI to add a 'blacklisting' function, allowing it to freeze tokens in specific wallets without disclosing this to investors or putting it to a governance vote. The complaint argues that this modification enabled World Liberty Financial to freeze Sun's tokens, pressuring him to mint $200 million of the company's USD1 stablecoin and manipulating the market price of $WLFI tokens. Furthermore, the lawsuit claims that World Liberty Financial's ability to issue, freeze, and reassign tokens may raise regulatory questions, potentially qualifying the firm as a money transmitter under US Financial Crimes Enforcement Network rules.
Other allegations include threats made by World Liberty co-founder Chase Herro to burn Sun's $WLFI tokens and report him to US authorities. The lawsuit was filed after Sun claimed to have tried to resolve the situation in good faith, seeking to be treated like other early investors who received tokens.