Tron founder Justin Sun has initiated a lawsuit against World Liberty Financial, a stablecoin and cryptocurrency company backed by the Trump family, alleging that the firm locked up his $WLFI token holdings, engaged in deceptive practices, and made defamatory statements. The lawsuit, which mentions Sun's support for Trump, claims that World Liberty's leadership participated in an 'illegal scheme to seize property' in the form of Sun's tokens, which he purchased after being solicited by the company in 2024. According to the lawsuit, Sun invested $45 million in $WLFI tokens 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 the USD1 stablecoin, World Liberty's principals allegedly became hostile towards him. The lawsuit alleges that World Liberty made fraudulent misrepresentations about the economic rights and liberties associated with purchasing $WLFI tokens, including statements about token holder rights and 'freedom to transact.' Furthermore, the suit claims that World Liberty, despite presenting itself as a decentralized finance business, exerted centralized control over its tokens. The company allegedly modified the smart contract governing $WLFI in August 2025 to add a 'blacklisting' function, allowing it to freeze tokens in specific wallets without disclosing this change to investors. The lawsuit argues that this modification enabled World Liberty to pressure Sun into minting $200 million of the USD1 stablecoin and manipulate the market price of $WLFI tokens.
By freezing Sun's tokens, the company allegedly 'artificially propped up the market price' of $WLFI tokens held by its founders and treasury. The complaint also raises regulatory concerns, suggesting that World Liberty's ability to issue, freeze, and reassign tokens may qualify it as a money transmitter, subjecting it to registration and anti-money laundering requirements.
Additionally, the lawsuit alleges that World Liberty made threats against Sun and his businesses, including a claim that the know-your-customer documentation submitted by Sun was inadequate. Sun has stated that he attempted to resolve the situation in good faith and seeks to be treated equally to other early investors who received tokens.