Justin Sun Sues World Liberty Financial for Token Freeze

Billionaire investor and Tron founder Justin Sun filed a federal lawsuit in San Francisco on April 21, 2026, accusing World Liberty Financial (WLFI) of fraud, breach of contract, and extortion. Sun alleges the Trump-family crypto venture used a hidden backdoor function to freeze his 4 billion WLFI tokens and stripped him of governance voting rights. He claims the retaliation occurred after he refused demands to invest $200 million to mint and promote a USD1 stablecoin on the Tron blockchain.

Sun asserts the firm is on the brink of collapse and insolvency, claiming the company misused the Trump brand to execute an illegal scheme. While his initial investments totaled between $45 million and $75 million, the value of his holdings fluctuated wildly due to token volatility, with estimates ranging from $75 million to $320 million. Sun also alleges that co-founder Chase Herro threatened him with referrals to U.S. authorities to prevent legal action.

World Liberty Financial CEO Zach Witkoff dismissed the claims as entirely meritless, stating Sun's own misconduct necessitated the freeze to protect users. Co-founder Eric Trump ridiculed the lawsuit on social media, mocking Sun's previous $6 million purchase of a banana-themed artwork. The company continues to face scrutiny over undisclosed token sales and a $75 million loan taken using its own tokens as collateral. The White House stated that President Donald Trump is not involved in the venture's day-to-day management, which is overseen by his children and associates.