Justin Sun, the founder of Tron, has initiated a lawsuit against World Liberty Financial, a cryptocurrency firm with ties to the family of former U.S. President Donald Trump. The lawsuit, filed on Tuesday, claims that World Liberty Financial wrongfully locked up Sun's $WLFI token holdings, made deceitful representations, and threatened and defamed him. According to the lawsuit, Sun had invested $45 million in $WLFI tokens after being approached 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.
A spokesperson for World Liberty Financial has declined to comment on the lawsuit. The lawsuit alleges that World Liberty asked Sun to continue investing in 2025, including a request to mint the company's USD1 stablecoin. However, when it became clear that Sun would not invest on their terms by July 2025, World Liberty's principals 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 lawsuit also alleges that World Liberty, despite presenting itself as a decentralized finance business, had centralized control over its tokens. The complaint states that World Liberty modified 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 change to investors. The lawsuit claims that this modification was used to freeze Sun's tokens, serving the dual purpose of pressuring him to mint $200 million of the company's USD1 stablecoin on his Tron blockchain and manipulating the market price of $WLFI tokens. By locking up Sun's position, the complaint argues, World Liberty artificially propped up the market price of $WLFI tokens held by the company's founders and corporate treasury.
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 U.S. Financial Crimes Enforcement Network rules. Other allegations in the complaint include threats made by World Liberty's co-founder, Chase Herro, to burn Sun's $WLFI tokens and to report him to U.S. authorities over allegedly inadequate know-your-customer documentation.
Sun has stated that he tried 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 a new governance proposal published by World Liberty on April 15.