Tron founder Justin Sun has initiated a lawsuit 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 threatened him. According to the lawsuit, Sun 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 purported goal of promoting decentralized finance. However, when Sun declined to continue investing in 2025, including a request to mint World Liberty's USD1 stablecoin, the company's leadership allegedly became hostile towards him.
The lawsuit claims that World Liberty made fraudulent misrepresentations about the rights and benefits associated with purchasing $WLFI tokens, including statements about governance rights and the freedom to transact. It is also alleged that the company altered the smart contract governing $WLFI in August 2025 to introduce a 'blacklisting' function, allowing it to freeze tokens in specific wallets without disclosure or a governance vote. This modification allegedly enabled World Liberty to freeze Sun's tokens, exerting pressure on him to mint $200 million of the USD1 stablecoin and artificially inflating the market price of $WLFI tokens held by the company's founders and treasury.
The lawsuit further argues that World Liberty's ability to issue, freeze, and reassign tokens may undermine its claims of decentralization and raise regulatory concerns, potentially qualifying the firm as a money transmitter subject to 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 report him to US authorities over allegedly inadequate know-your-customer documentation. Sun has stated that he attempted to resolve the situation amicably and seeks equal treatment as other early investors who received tokens.