Justin Sun, the founder of Tron, has initiated a lawsuit against World Liberty Financial, a cryptocurrency firm with ties to the family of former US President Donald Trump. The lawsuit claims that World Liberty unfairly froze Sun's $WLFI token holdings, made false representations, and threatened 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 association with the Trump family. The lawsuit alleges that World Liberty's leadership engaged in an illegal scheme to seize Sun's tokens and that the company made fraudulent misrepresentations about the rights and liberties associated with purchasing $WLFI tokens. World Liberty reportedly 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, World Liberty's principals allegedly became hostile towards him.
The lawsuit also claims that World Liberty changed the smart contract governing $WLFI in August 2025 to add a 'blacklisting' function, allowing the company to freeze tokens in specific wallets without disclosing this to investors. This modification was not put to a governance vote, and token holders had just approved a proposal to make a portion of the supply tradable. The complaint argues that World Liberty's freezing of Sun's tokens served to pressure him into minting $200 million of the company's USD1 stablecoin on his Tron blockchain and to manipulate $WLFI's market price. By locking up Sun's position, World Liberty allegedly 'artificially propped up the market price of $WLFI tokens held by World Liberty founders and the company's corporate treasury.' The lawsuit raises regulatory questions, suggesting that World Liberty's ability to issue, freeze, and reassign tokens may qualify the firm as a money transmitter under US Financial Crimes Enforcement Network rules.
Other allegations include threats made by World Liberty's co-founder, Chase Herro, to burn Sun's $WLFI tokens and to report him to US authorities over allegedly inadequate know-your-customer documentation. A spokesperson for World Liberty Financial stated that the company had no comment on the lawsuit.
Sun has expressed his desire to be treated the same as other early investors who received tokens and has voiced his opposition to World Liberty's new governance proposal published on April 15.