Justin Sun, the founder of Tron, has initiated a lawsuit against World Liberty Financial, a cryptocurrency firm backed by the Trump family, claiming the company locked up his $WLFI holdings without justification, made false representations, and issued threats against him. The lawsuit, filed on Tuesday, asserts that World Liberty's actions constitute an 'illegal scheme to seize property' in the form of Sun's tokens, which he purchased after being approached by the company in 2024. Sun invested $45 million in $WLFI tokens, reportedly due to the project's potential to promote decentralized finance and its connection to the Trump family. A spokesperson for World Liberty Financial declined to comment on the lawsuit.
According to the filing, World Liberty asked Sun to continue investing in 2025, including a request to mint the company's USD1 stablecoin. However, when Sun refused to invest on their terms, the company's principals allegedly became hostile towards him. The lawsuit claims 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 alleges that World Liberty, despite presenting itself as a decentralized finance business, has centralized control over its tokens. The company modified the smart contract governing $WLFI in August 2025 to add a 'blacklisting' function, which allowed it to freeze tokens in specific wallets without disclosing this change to investors. The complaint argues that this modification enabled World Liberty to freeze Sun's tokens, serving a dual purpose: pressuring him to mint $200 million of the company's USD1 stablecoin and manipulating the market price of $WLFI tokens.
By locking up Sun's position, the complaint claims that World Liberty artificially inflated the market price of $WLFI tokens held by the company's founders and treasury. The lawsuit 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. Other allegations include threats made by World Liberty's co-founder, Chase Herro, to burn Sun's $WLFI tokens and report him to U.S.
authorities for allegedly inadequate know-your-customer documentation. Portions of the lawsuit have been redacted, with Sun's team offering the World Liberty team an opportunity to decide whether these provisions should remain sealed. In a social media post, Sun stated that he had attempted to resolve the situation in good faith and sought equal treatment as other early investors. He also expressed opposition to World Liberty's new governance proposal, published on April 15.
This development comes after Sun settled charges with the U.S. Securities and Exchange Commission last month, agreeing to pay a $10 million fine to resolve a case brought by the previous presidential administration.