A crypto project tied to the Donald Trump family is facing serious legal trouble after billionaire investor Justin Sun filed a lawsuit accusing the firm of extortion and an “illegal scheme.”
The lawsuit targets World Liberty Financial, a digital asset project co-founded by Trump and his son Eric Trump, marking a dramatic escalation in tensions between the company and one of its earliest backers.
Billion-Dollar Dispute Explodes
In a complaint filed in San Francisco federal court, Sun claims World Liberty froze his tokens and stripped him of governance rights, effectively locking him out of decisions tied to the project.
“They wrongfully froze all of my tokens… and threatened to permanently destroy them,” Sun alleged, describing the situation as both unjustified and alarming.
The dispute centers on WLFI tokens, a key part of the project’s ecosystem, which Sun says were taken out of his control without due process.
Investment Turns Into Conflict
Sun had heavily backed the venture, investing around $45 million to acquire billions of WLFI tokens across 2024 and 2025. He was also granted additional tokens in an advisory role.
However, the relationship reportedly deteriorated after Sun declined to increase his financial support. What followed was a public fallout, with both sides exchanging accusations on social media platform X.
Concerns Over Stability
Beyond the token dispute, Sun raised concerns about the financial health of the project, warning that World Liberty may be “on the verge of collapse.”
He also questioned whether the company has sufficient reserves to support its USD1 stablecoin—raising potential red flags for investors and regulators.
Token Value Plunges
The controversy comes as WLFI tokens have sharply declined in value. Since September, the price has dropped from 31 cents to under 8 cents, intensifying scrutiny around the project’s stability and governance.
A Supporter Turns Critic
Interestingly, Sun has previously been a vocal supporter of Trump’s pro-crypto stance. He also founded TRON, a multi-billion-dollar blockchain network.
Despite his support, Sun now claims that certain individuals within World Liberty are acting against the values associated with the former president.
What Happens Next?
With legal proceedings now underway, the case could have broader implications for crypto governance, investor rights, and political ties to digital asset ventures.
As the clash unfolds, it highlights the growing risks—and high stakes—within the rapidly evolving crypto industry.
