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 alleges that World Liberty Financial engaged in an illegal scheme to seize Sun's $WLFI tokens, made fraudulent representations, and defamed 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. However, when Sun refused to continue investing in 2025, including a request to mint World Liberty's USD1 stablecoin, the company's principals allegedly became hostile towards him. The lawsuit claims that World Liberty Financial induced Sun to invest through fraudulent misrepresentations about the economic rights and liberties associated with purchasing $WLFI tokens.
These misrepresentations allegedly included statements about token holders' rights, governance rights, and the freedom to transact. The lawsuit also alleges that World Liberty Financial, despite presenting itself as a decentralized finance business, had centralized control over its tokens. In August 2025, the company modified the smart contract governing $WLFI to add a 'blacklisting' function, allowing it 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 a dual purpose: 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 lawsuit argues that World Liberty Financial artificially propped up the market price of $WLFI tokens held by the company's founders and treasury. The lawsuit raises regulatory questions, suggesting that World Liberty Financial'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 include threats made by World Liberty's co-founder, Chase Herro, to burn Sun's $WLFI tokens and report him to U.S. authorities. A spokesperson for World Liberty Financial declined to comment on the lawsuit.
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.