Justin Sun, the founder of Tron, has filed a lawsuit against World Liberty Financial, a cryptocurrency firm with ties to the Trump family, alleging that the company froze his $WLFI token holdings and made fraudulent representations. The lawsuit, which was filed on Tuesday, claims that World Liberty's leadership engaged in an 'illegal scheme to seize property' in the form of Sun's tokens, which he had purchased after being solicited by the company in 2024. According to the lawsuit, Sun invested $45 million in $WLFI tokens due to the project's claims that it would promote decentralized finance, as well as its association with the Trump family. However, when Sun refused to continue investing in 2025, World Liberty's principals became hostile towards him.
The lawsuit alleges that World Liberty made fraudulent misrepresentations about the economic rights and liberties associated with purchasing $WLFI tokens, including statements about token holder governance rights and the freedom to transact. The company is also accused of having centralized control over its tokens, despite presenting itself as a decentralized finance business.
In August 2025, World Liberty allegedly modified the smart contract governing $WLFI to add a 'blacklisting' function, which allowed the company to freeze tokens in specific wallets without disclosing this change to investors. The lawsuit claims that World Liberty froze Sun's tokens to pressure him into minting $200 million of the company's USD1 stablecoin on the Tron blockchain and to manipulate the market price of $WLFI tokens.
By locking up Sun's position, World Liberty allegedly 'artificially propped up' the market price of $WLFI tokens held by the company's founders and corporate treasury. The lawsuit also raises regulatory concerns, arguing that World Liberty's ability to issue, freeze, and reassign tokens may qualify it as a money transmitter under US law, subjecting it to registration and anti-money laundering requirements. Additionally, the lawsuit alleges that World Liberty made threats against Sun and his businesses, including a claim that the company would burn Sun's $WLFI tokens if he did not request that they be burned. A spokesperson for World Liberty Financial declined to comment on the lawsuit.
In a social media post, Sun stated that he had tried to resolve the situation in good faith and wanted to be treated the same as other early investors who received tokens.