Justin Sun, the founder of the Tron cryptocurrency, has initiated a lawsuit against World Liberty Financial, a company backed by associates of former US President Donald Trump. The lawsuit, filed on Tuesday, claims that World Liberty Financial had wrongfully frozen Sun's $WLFI token holdings, engaged in deceptive practices, and made defamatory statements against him. According to the lawsuit, Sun had invested $45 million in $WLFI tokens after being approached by World Liberty's team in 2024, partly due to the project's connection to the Trump family.
However, when Sun declined to continue investing in 2025, including a request to mint the company's USD1 stablecoin, World Liberty's leadership allegedly became hostile towards him. The lawsuit alleges that World Liberty made false representations about the rights and benefits associated with purchasing $WLFI tokens, including statements about governance rights and the freedom to transact.
It is also claimed that the company exerted centralized control over its tokens, contrary to its decentralized finance claims. In August 2025, World Liberty modified the smart contract governing $WLFI to introduce a 'blacklisting' function, allowing the company to freeze tokens in specific wallets without disclosure to investors. The lawsuit argues that this modification was used to freeze Sun's tokens, pressuring him to mint $200 million of the USD1 stablecoin and artificially inflating the market price of $WLFI tokens held by World Liberty's founders and treasury.
The complaint further alleges that World Liberty's actions may be subject to regulatory scrutiny, potentially qualifying the company as a money transmitter under US Financial Crimes Enforcement Network rules. Other allegations include threats made by World Liberty's co-founder, Chase Herro, against Sun and his businesses. Sun has stated that he attempted to resolve the situation amicably and seeks equal treatment as other early investors who received tokens.