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 Financial froze Sun's $WLFI token holdings without justification, made false representations, and issued threats against him. According to the lawsuit, Sun invested $45 million in $WLFI tokens after being solicited by World Liberty's team in 2024, partly due to the project's association with the Trump family and its claims of promoting decentralized finance.
However, when Sun declined to continue investing in 2025, including a request to mint the USD1 stablecoin, World Liberty's principals allegedly 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.
It is also claimed that World Liberty 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 disclosing this change to investors or putting it to a governance vote. The lawsuit argues that this modification enabled World Liberty to freeze Sun's tokens, serving the dual purpose of pressuring him to mint $200 million of the USD1 stablecoin on the Tron blockchain and artificially propping up the market price of $WLFI tokens held by World Liberty founders and its corporate treasury. This ability to issue, freeze, and reassign tokens may not only undermine World Liberty's decentralization claims but also raise regulatory concerns, potentially qualifying the firm as a money transmitter subject to registration and anti-money laundering requirements.
The complaint also includes allegations of threats made by World Liberty's co-founder, Chase Herro, against Sun and his businesses. Herro allegedly threatened to burn Sun's $WLFI tokens if Sun did not request their destruction and falsely claimed that Sun's know-your-customer documentation was inadequate, threatening to report him to US authorities. A spokesperson for World Liberty Financial declined to comment on the lawsuit.
Sun has stated that he attempted to resolve the situation in good faith and seeks to be treated equally to other early investors who received tokens. He also expressed opposition to World Liberty's new governance proposal published on April 15.