Tron founder Justin Sun has filed suit against World Liberty Financial, the stablecoin and crypto firm backed by members of former President Donald Trump’s family, accusing the project’s leadership of freezing his tokens, making fraudulent promises, and threatening him and his companies.
Key claims in the complaint
- Sun says he invested $45 million in WLFI tokens in 2024 after World Liberty solicited him—partly because of the project’s DeFi pitch and the Trump family association. The suit even notes Sun’s support for Trump.
- The complaint alleges World Liberty misrepresented token-holder rights, governance, and “freedom to transact,” inducing Sun’s investment through omissions and false statements.
- World Liberty is accused of centralizing control despite marketing itself as decentralized. Sun alleges the firm quietly modified the WLFI smart contract in August 2025 to add a “blacklisting” function that lets the company freeze tokens in specific wallets. The change, he says, was not disclosed to token holders or put to a governance vote.
- Sun claims World Liberty froze his WLFI to pressure him to mint $200 million of the firm’s USD1 stablecoin on Tron and to prop up WLFI’s market price by preventing a major holder from selling. The complaint frames that action as both coercive and market-manipulating.
- The suit also flags regulatory risk: World Liberty’s control to issue, freeze, or reassign tokens could, the filing argues, make it a money transmitter under FinCEN rules—potentially subjecting it to registration and AML obligations.
- Additional accusations include two alleged threats from co-founder Chase Herro: one to burn Sun’s WLFI unless Sun requested burning, and another claiming Sun’s KYC paperwork was inadequate and threatening to report him to U.S. authorities.
Procedural and public details
- Portions of the filing are redacted; an attached motion explains Sun’s team gave World Liberty a chance to seek continued sealing of those sections under a confidentiality provision.
- World Liberty Financial declined to comment when contacted.
- On X, Sun said he tried “in good faith” to resolve the dispute and wants equal treatment with other early investors. He also said he opposes a new governance proposal World Liberty published on April 15.
Context
- The lawsuit points to broader tensions in crypto around alleged on-chain centralization, governance opacity, and how smart-contract upgrades can be used to exert off-chain control.
- Sun has become more visible in the U.S. since President Trump took office and attended a Trump-linked memecoin dinner last year tied to a different project.
- Last month Sun settled SEC charges, paying a $10 million fine to resolve a case brought by the prior U.S. administration.
What’s next
The complaint seeks relief for the alleged seizure and freezing of Sun’s tokens and other damages. The case is now in court; World Liberty’s response and potential regulatory scrutiny will be watched closely by the crypto community given the high-profile players and questions about token governance and centralized control.
Read more AI-generated news on: undefined/news
