The conflict between Justin Sun and World Liberty Financial, a cryptocurrency project linked to the Trump family, has entered the litigation stage. According to his lawsuit filed in the U.S. Federal Court in San Francisco, the dispute centers on control of the WLFI token, trading restrictions, and governance voting rights.
Justin Sun alleges that his tokens were frozen.
Justin Sun stated that World Liberty froze all of his WLFI tokens without justifiable reason and revoked his voting rights on governance proposals. He also claimed that the project threatened to "burn" these tokens, permanently removing them through a process called "burning."
He posted on social media that the actions constituted an "illegal scheme" aimed at seizing WLFI tokens. He also targeted project co-founder Chase Herro, claiming that some individuals associated with the project were profiting from the Trump brand.
Early investors and project teams are openly at odds.
Justin Sun is the founder of TRON and one of the early supporters of World Liberty. Reports indicate that he initially invested $45 million in the project and claimed that his stake in WLFI was valued at over $1 billion at one point.
However, the price of WLFI has fallen significantly since September of last year. The report mentions that the price of a single WLFI token has dropped from $0.31 to less than $0.08.
- Justin Sun initially invested approximately $45 million.
- It stated that its holdings were once valued at over $1 billion.
- WLFI prices fell from $0.31 to less than $0.08.
In his lawsuit, Justin Sun also stated that the project initially implied to holders that the tokens would be freely tradable in the future, but this promise was "false and misleading." He stated that although some tokens were later made tradable, he was still restricted from selling any WLFI.
World Liberty denies any wrongdoing.
World Liberty denied the allegations. Co-founder Zach Witkoff stated that the lawsuit was an attempt to divert attention from Justin Sun's own actions, and that the claims were "baseless." The company will urge the court to dismiss the case as soon as possible.
He also stated that World Liberty took action to protect the platform and its users, but did not disclose more specific grounds for the action in the report. Eric Trump also publicly responded, mocking the lawsuit.
The background to the SEC's withdrawal of the case has once again attracted attention.
The report also mentioned that the U.S. Securities and Exchange Commission had previously dropped its investigation into Justin Sun. Democratic Senator Elizabeth Warren had questioned whether this development was related to his investments in Trump's crypto projects.
Currently, this dispute has escalated from an internal conflict within the project to a public legal battle. For World Liberty, the case not only involves the rights of token holders but may also further amplify external doubts about its governance methods and project operations.
