Justin Sun, the creator 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, filed on Tuesday, claims that World Liberty unfairly locked up Sun's $WLFI token holdings, made false representations, and threatened and defamed him. According to the lawsuit, World Liberty's leadership engaged in an 'illegal scheme to seize property' in the form of Sun's tokens, which he purchased after being solicited by the company in 2024.
Sun invested $45 million in $WLFI tokens, partly due to the project's association with the Trump family and its claims of promoting decentralized finance. A spokesperson for World Liberty Financial 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 Sun refused to invest on their terms, 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 suit also alleges that World Liberty, despite presenting itself as a decentralized finance business, has centralized control over its tokens.
The company modified the smart contract governing $WLFI in August 2025 to add a 'blacklisting' function, allowing it to freeze tokens in specific wallets without disclosing this to investors. The lawsuit argues that World Liberty's freezing of Sun's tokens served to pressure him into minting $200 million of the company's USD1 stablecoin and to manipulate the market price of $WLFI tokens.
By locking up Sun's position, World Liberty 'artificially propped up the market price of $WLFI tokens held by World Liberty founders and the company's 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 US Financial Crimes Enforcement Network rules. Other allegations include threats made by World Liberty co-founder Chase Herro to burn Sun's $WLFI tokens and to report him to US authorities. Sun stated on social media that he had tried to resolve the situation in good faith and wants to be treated the same as other early investors.
He also expressed opposition to World Liberty's new governance proposal published on April 15.