Cryptocurrency billionaire Justin Sun and his company have sued World Liberty Financial, a cryptocurrency project co-founded by US President Donald Trump, accusing the company of extortion and carrying out an “illegal scheme” to seize his tokens.
In the lawsuit filed by Sun Yuchen in the federal court of San Francisco on Tuesday, he also claimed that “World Liberty Company is on the verge of collapse” and questioned whether the company has sufficient reserves to support its $1 stablecoin.
According to the lawsuit documents, Sun Yuchen invested a total of 45 million US dollars in 2024 and 2025 to purchase 3 billion WLFI tokens of World Liberty, and received an additional 1 billion WLFI tokens for providing consulting services to the project.
But he said that his relationship with the World Liberty team deteriorated after he refused to continue providing investment and support for the project in the middle of last year. In recent weeks, as conflicts between the project and early investors have intensified, Sun Yuchen and World Liberty have engaged in a fierce war of words on social network X.
“Unfortunately, some people on the World Freedom Project team have been operating the project in a way that goes against President Trump’s values,” Sun posted on X.
In the complaint, Sun Yuchen claimed that when World Liberty “secretly implanted power” to freeze his tokens and prevent him from selling any tokens, he and his company suffered “losses of hundreds of millions of dollars”.
According to the complaint, the company also obtained the right to destroy Sun Yuchen’s tokens, even if they were stored in his own digital wallet; in addition, the company was granted new blacklist privileges, allowing it to restrict the transfer of users’ tokens. Sun Yuchen said that in November last year, World Liberty implemented a change that allowed it to reallocate WLFI tokens from any user to other users.
Sun Yuchen claimed that World Liberty had been “constantly pressuring” him to invest in its $1 stablecoin and promote its application on the Tron blockchain he founded, and also “attempting to obtain equity investment in World Liberty’s holding company”. The complaint stated that by July, when he made it clear that he would not make a commitment, “the person in charge of World Liberty began to hold a grudge against Mr. Sun”.
According to the complaint, in September this year, Chase Herro, the co-founder of the project, threatened to destroy the tokens held by Sun Yuchen, which were worth 776 million US dollars at that time. The complaint also pointed out that World Liberty threatened to report Sun Yuchen to the criminal department if he tried to defend his rights, “This coercive measure itself constitutes criminal extortion.”
Sun Yuchen stated that World Liberty had frozen his WLFI tokens, partly because the company was dissatisfied with his purchase of a $100 million Trump memecoin.
Outside of normal working hours, Herro did not immediately respond to a request for comment.
According to the complaint, World Liberty agreed in December not to destroy Sun’s tokens during the negotiations that lasted until late February.
Sun Yuchen claimed that World Liberty “seems to be in financial trouble”. Recently, World Liberty obtained a loan by using WLFI tokens as collateral. The company stated that it has sufficient funds to avoid defaulting on the loan.
Sun Yuchen has requested the court to unfreeze his tokens, award unspecified monetary compensation, and prevent World Freedom Company from destroying or mortgaging his tokens.
Early investors in this project still cannot trade 80% of the tokens they hold. A proposal currently under review would delay the trading rights of these tokens for at least two years. According to the proposal, insiders of the project will be unable to trade their tokens for an even longer period.
