Justin Sun, the founder of Tron, has initiated a lawsuit against World Liberty Financial, a cryptocurrency firm with ties to the family of former U.S. President Donald Trump.
The lawsuit claims that World Liberty unfairly locked up Sun's $WLFI holdings, engaged in fraudulent activities, and made defamatory statements against 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 connection to the Trump family.
However, when Sun refused to continue investing in 2025, World Liberty's leadership allegedly became hostile towards him. The lawsuit alleges that World Liberty made false representations about the economic rights associated with purchasing $WLFI tokens and that the company has centralized control over its tokens, contrary to its claims of operating in the decentralized finance sector.
World Liberty is also accused of changing the smart contract governing $WLFI to add a 'blacklisting' function, which allowed the company to freeze tokens in specific wallets without disclosing this to investors. The lawsuit claims that this modification was used to freeze Sun's tokens, which served to pressure him into minting $200 million of World Liberty's USD1 stablecoin and to artificially inflate the market price of $WLFI tokens.
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 under U.S. Financial Crimes Enforcement Network rules.
Additionally, the lawsuit alleges that World Liberty made threats against Sun, including a threat to burn his $WLFI tokens and to report him to U.S. authorities over allegedly inadequate know-your-customer documentation. 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.