Tron's founder, Justin Sun, has initiated a lawsuit against World Liberty Financial, a cryptocurrency firm with ties to the Trump family, claiming the company locked up his $WLFI token holdings without justification, made false claims, and intimidated him. The lawsuit, which mentions Sun's support for former US President Donald Trump, asserts that World Liberty's management engaged in an unlawful scheme to seize Sun's tokens, which he purchased after being approached 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 purported goal of promoting decentralized finance, a cause close to Sun's heart. A World Liberty Financial spokesperson declined to comment on the lawsuit. According to the filing, 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 by July 2025, World Liberty's principals allegedly became hostile towards him.
The lawsuit claims that World Liberty misled investors, including Sun, through false statements about the economic rights and freedoms associated with purchasing $WLFI tokens. These alleged misrepresentations include claims about token holders' rights, public statements by World Liberty or its executives about governance rights, and statements about the freedom to transact. Sun's lawsuit also alleges that World Liberty, despite presenting itself as a decentralized finance business, exerted 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 change to investors or putting it to a governance vote.
This modification enabled World Liberty to freeze Sun's tokens, which the lawsuit claims served two purposes: coercing Sun into minting $200 million of the company's USD1 stablecoin on his Tron blockchain and manipulating the market price of $WLFI tokens by preventing one of the largest holders from selling. By doing so, World Liberty artificially inflated the market price of $WLFI tokens held by the company's founders and treasury, according to the complaint. The lawsuit argues that World Liberty's ability to issue, freeze, and reassign tokens may not only undermine its claims of decentralization but also raise regulatory concerns, potentially qualifying the firm as a money transmitter subject to registration and anti-money laundering requirements under US Financial Crimes Enforcement Network rules. The complaint further alleges that World Liberty made explicit threats to Sun and his businesses, including a threat by co-founder Chase Herro to burn Sun's $WLFI tokens if Sun did not request their destruction.
Herro also allegedly claimed that the know-your-customer documentation submitted by Sun was inadequate and threatened to report him to US authorities. Parts of the lawsuit have been redacted, with an attached filing mentioning a confidentiality provision that allows the World Liberty team to decide whether these provisions should remain sealed.
In a social media post, Sun stated that he had attempted to resolve the situation amicably and sought equal treatment as other early investors who received tokens. Sun also expressed his opposition to a new governance proposal published by World Liberty on April 15. Following his previous avoidance of the US due to regulatory concerns, Sun has visited the country since Trump's presidency, including attending a Trump-linked cryptocurrency project's dinner last year. Recently, Sun settled charges with the US Securities and Exchange Commission, agreeing to pay a $10 million fine to resolve a case initiated by the previous administration.