World Liberty Financial (WLFI), a cryptocurrency venture co-founded by former US President Donald Trump and his son Eric Trump, has been sued by billionaire investor Justin Sun over allegations of an "illegal scheme" to seize his WLFI tokens. Sun accuses the company of freezing all his tokens, stripping him of voting rights on governance issues, and threatening to permanently destroy them by "burning" without proper justification. He claims that those running WLFI, including another co-founder Chase Herro, are using it as a "golden opportunity to leverage the Trump brand to profit through fraud," allegedly acting against the values of the former president.

Justin Sun, the founder of the separate multi-billion dollar crypto project TRON, initially invested $45 million in WLFI, with his tokens valued at over $1 billion at times. However, since September, the price of a single WLFI token has plummeted from 31 cents to under 8 cents. Sun stated that his backing was driven by the Trump family's association and his long-standing support for cryptocurrencies, adding that he also purchased $100 million of Trump's meme coins in July 2025. In his complaint filed in a San Francisco federal court, he argues that initial promises to allow token-holders to trade in the future "were false and misleading."

While other investors have been able to trade the tokens, Sun alleges that WLFI has blocked him from selling any and is now threatening to "burn" his holdings. WLFI has denied wrongdoing, accusing Sun of "playing the victim while making baseless allegations to cover up his own misconduct." Investors have also grown concerned about World Liberty borrowing against the value of its tokens, adding to the financial uncertainties surrounding the project. This lawsuit highlights ongoing tensions in the crypto industry, particularly involving high-profile political figures and regulatory scrutiny.

Meanwhile, the Securities and Exchange Commission (SEC) has dropped its investigation into Sun, with Senator Elizabeth Warren, a Democrat, questioning if this decision was tied to his investments in Trump's crypto ventures. Sun had previously been accused of paying high-profile influencers to promote his companies on social media without disclosing the payments. The case raises broader issues about transparency and accountability in cryptocurrency operations linked to political elites, amid a backdrop of volatile market conditions and increasing investor skepticism.

Source: www.bbc.com