Tron founder Justin Sun has taken legal action against World Liberty Financial, a cryptocurrency firm with ties to the family of former US President Donald Trump, alleging that the company froze his $WLFI token holdings without justification, made false representations, and engaged in threatening behavior. The lawsuit, filed recently, asserts that World Liberty's actions constitute an illegal scheme to seize property, specifically Sun's tokens, which he claims to have purchased after being approached by the company's team in 2024. Sun invested $45 million in $WLFI tokens, reportedly due to the project's association with the Trump family and its purported commitment to promoting decentralized finance, a cause close to Sun's heart.
A spokesperson for World Liberty Financial declined to comment on the lawsuit. According to the filing, World Liberty requested that Sun continue investing in the project through 2025, including a proposal to mint the company's USD1 stablecoin.
However, when it became apparent that Sun would not invest or mint the stablecoin on World Liberty's terms, the company's principals allegedly became hostile towards him. The lawsuit alleges that World Liberty 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 holder rights, governance, and the freedom to transact.
Sun's suit also claims that World Liberty, despite presenting itself as a decentralized finance operator, exercised centralized control over its tokens. The complaint states that World Liberty modified the smart contract governing $WLFI in August 2025, introducing a 'blacklisting' function that allowed 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 World Liberty's freezing of Sun's tokens served two purposes: to pressure him into minting $200 million of the company's USD1 stablecoin on the Tron blockchain and to artificially inflate the market price of $WLFI tokens held by World Liberty's founders and treasury.
By locking up Sun's position, World Liberty allegedly propped up the market price of $WLFI tokens, benefiting the company's founders and treasury. The complaint raises regulatory concerns, suggesting that World Liberty's ability to issue, freeze, and reassign tokens may qualify it as a money transmitter under US Financial Crimes Enforcement Network rules, subjecting it to registration and anti-money laundering requirements.
The lawsuit also alleges that World Liberty made threats against Sun and his businesses, including a claim by co-founder Chase Herro that he would burn Sun's $WLFI tokens if Sun did not request that they be burned. Herro allegedly threatened to report Sun to US authorities, citing inadequate know-your-customer documentation. Portions of the lawsuit have been redacted, with Sun's team offering World Liberty the opportunity to decide whether these provisions should remain sealed.
In a public post, Sun stated that he had attempted to resolve the situation in good faith and sought equal treatment as other early investors who received tokens. Sun also expressed opposition to a new governance proposal published by World Liberty on April 15. The lawsuit comes after Sun settled charges with the US Securities and Exchange Commission last month, agreeing to pay a $10 million fine to resolve a case brought by the previous presidential administration.