Justin Sun, the founder of Tron, has initiated a lawsuit against World Liberty Financial, a cryptocurrency firm with ties to the Trump family, alleging that the company unfairly froze his $WLFI token holdings and made false representations. The lawsuit, filed on Tuesday, claims that World Liberty's leadership engaged 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. Sun invested $45 million in $WLFI tokens, reportedly 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, World Liberty's principals 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 the freedom to transact. Sun's suit also claims that World Liberty, despite presenting itself as a decentralized finance business, has 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 to investors.
The complaint argues that World Liberty's freezing of Sun's tokens was intended to pressure him into minting $200 million of the company's USD1 stablecoin and to manipulate the market price of $WLFI tokens. The lawsuit raises regulatory questions, suggesting that World Liberty's ability to issue, freeze, and reassign tokens may qualify it as a money transmitter under US rules, subjecting it to registration and anti-money laundering requirements. Other allegations in the complaint include threats made by World Liberty's co-founder, Chase Herro, against Sun and his businesses.
Sun has stated that he tried to resolve the situation in good faith and wants to be treated the same as other early investors who received tokens.