Justin Sun, the founder of Tron, has taken legal action against World Liberty Financial, a cryptocurrency firm with ties to the family of former US President Donald Trump. The lawsuit, which was filed on Tuesday, claims that World Liberty unfairly froze Sun's $WLFI tokens, made false representations, and threatened and defamed him.
According to the lawsuit, Sun had invested $45 million in $WLFI tokens after being approached 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, including a request to mint World Liberty's USD1 stablecoin, the company's principals allegedly became hostile towards him.
The lawsuit alleges that World Liberty made fraudulent misrepresentations about the rights and benefits of purchasing $WLFI tokens, including statements about governance rights and the freedom to transact. It is also claimed that World Liberty has centralized control over its tokens, despite presenting itself as a decentralized finance business. 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 to investors. The lawsuit argues that this change was made without a governance vote and was used to freeze Sun's tokens, which served to pressure him into minting $200 million of the company's USD1 stablecoin and manipulate the market price of $WLFI tokens.
Additionally, the complaint alleges that World Liberty made threats against Sun and his businesses, including a claim that the company's co-founder, Chase Herro, threatened to burn Sun's $WLFI tokens if he did not request that they be burned. The lawsuit also 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. A spokesperson for World Liberty Financial stated that the company had no comment on the lawsuit.
In a post on social media, Sun stated that he had tried to resolve the situation in good faith and wanted to be treated the same as other early investors who received tokens.