Justin Sun, the creator 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, filed on Tuesday, claims that World Liberty Financial unfairly froze Sun's $WLFI token holdings, made false representations, and threatened him. According to the lawsuit, Sun was solicited by World Liberty's team in 2024 to invest in $WLFI tokens, and he subsequently invested $45 million. The investment was made partly due to the project's claims of promoting decentralized finance, a cause close to Sun's heart, and also due to the Trump family's involvement with the project.
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 it became clear that Sun would not invest on their terms by July 2025, the principals of World Liberty 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 holders' rights, governance rights, and the freedom to transact. Sun's lawsuit also alleges that World Liberty, despite presenting itself as a decentralized finance business, had centralized control over its tokens. The complaint states that World Liberty modified the smart contract governing $WLFI in August 2025 to add a 'blacklisting' function, allowing the company to freeze tokens in specific wallets without disclosing this to investors or putting it to a governance vote. The lawsuit claims that the freezing of Sun's tokens served a dual purpose: to pressure him into minting $200 million of the company's USD1 stablecoin on his Tron blockchain and to manipulate the market price of $WLFI tokens by preventing one of the largest holders from selling.
By locking up Sun's position, the complaint argues, World Liberty artificially supported the market price of $WLFI tokens held by the company's founders and its 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 U.S. Financial Crimes Enforcement Network rules, subjecting it to registration and anti-money laundering requirements.
Other allegations in the complaint include threats made by World Liberty's co-founder, Chase Herro, to burn Sun's $WLFI tokens if Sun did not request that his tokens be burned. Herro also allegedly threatened to report Sun to U.S. authorities, claiming that the know-your-customer documentation submitted by Sun was inadequate. Portions of the lawsuit were redacted, with Sun's team giving World Liberty the opportunity to decide whether these provisions should remain sealed.
In a 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. Sun also expressed his opposition to a new governance proposal published by World Liberty on April 15. Since Trump took office, Sun has visited the U.S.
and was a guest at a Trump-linked crypto project dinner last year. Recently, Sun settled charges with the U.S. Securities and Exchange Commission, agreeing to pay a $10 million fine to resolve a case brought by the previous presidential administration.