Justin Sun, the founder of Tron, has filed a lawsuit in a California federal court against World Liberty Financial, alleging that the project unlawfully froze his $WLFI tokens and threatened to burn them without proper justification.
In a statement posted on social media on Wednesday, Sun said the legal action was necessary to protect his rights as a holder of $WLFI tokens after attempts to resolve the issue privately failed.
According to Sun, members of the World Liberty project team froze all of his tokens, removed his ability to participate in governance votes, and warned that the tokens could be permanently destroyed through a “burn” mechanism. He argued that these actions were taken without adequate explanation or due process.
Sun emphasized that the lawsuit should not be interpreted as opposition to Donald Trump or his administration’s pro-cryptocurrency stance. He described himself as a strong supporter of efforts to make the United States more welcoming to the digital asset industry.
However, Sun claimed that certain individuals involved in the World Liberty project have acted in ways that contradict those values. He said he believes Trump would not support such actions if he were aware of them.
The dispute also centers on a governance proposal released by World Liberty on April 15. According to Sun, the proposal would require token holders to affirmatively accept new terms, including a rule mandating that 10% of advisor tokens be permanently burned.
If token holders fail to accept the proposal, their tokens could be locked indefinitely. The plan also introduces a two-year cliff followed by a two-year vesting schedule for early purchaser tokens.
Sun argued that the proposal is harmful to the community and criticized the fact that his frozen tokens prevent him from voting on the measure.
The case highlights growing tensions around governance rights and token control within crypto projects. The outcome could have broader implications for how token holder rights are enforced in decentralized finance ecosystems.
