Tron founder Justin Sun has filed a lawsuit in a California federal court against World Liberty Financial (WLFI), alleging the project team froze his WLFI tokens without justification, blocked his governance voting rights, and threatened to permanently destroy his holdings through a burn mechanism. The legal action, announced Tuesday, quickly drew attention from the crypto community over project governance transparency and early investor protections.
Token Freeze and Voting Rights Stripped
Sun stated that the WLFI team froze his tokens without offering any explanation, directly barring him from voting on governance proposals. He further claimed the team threatened to permanently eliminate his assets via a burn mechanism—calling the actions “unfair and inconsistent with standard investor treatment.” Before filing the suit, Sun said he attempted to resolve the matter directly, but the team refused to restore his access or rights. He emphasized that he seeks equal treatment compared with other early investors and framed the case as a dispute over fairness and transparency.
Escalation: April 15 Governance Proposal
Tensions heightened after a governance proposal released on April 15. Sun said the proposal enforces strict conditions: token holders must accept new terms or face indefinite lockups; it also mandates a 10% burn of advisor tokens. Additionally, early investors face a two-year cliff followed by a two-year vesting schedule. Due to the token freeze, Sun cannot vote on the proposal and cannot influence its outcome. He publicly stated he “strongly opposes the proposal’s structure.” Sun had previously raised concerns about a “backdoor blacklisting” feature within the system, which he claims allows the team to freeze or restrict user assets without consent.
Position on Trump’s Crypto Stance
Despite the legal dispute, Sun reaffirmed support for President Donald Trump’s broader crypto stance. He noted the issue is about project operations, not political alignment. “I do not believe Trump would support the actions if aware,” Sun added. The lawsuit adds pressure on WLFI, which already faces scrutiny over other financial issues. The case now places governance practices, asset control, and early investor treatment at the center of an ongoing industry debate.