Key Points
- World Liberty Financial filed a defamation lawsuit against Justin Sun in federal court on Monday
- The lawsuit alleges Sun engaged in short selling WLFI tokens and made straw purchases for other investors
- Sun filed his own lawsuit against World Liberty in April, alleging improper freezing of his token holdings
- The crypto platform claims Sun initiated a coordinated social media attack after the company declined to restore access to his frozen assets
- Sun’s total investment in World Liberty reached approximately $75 million in 2024, which included purchases of TRUMP meme coin
World Liberty Financial, the cryptocurrency platform established by President Donald Trump and his family members, has initiated federal legal proceedings against crypto billionaire Justin Sun, charging him with defamation and improper token trading practices.
The legal filing arrived Monday. This move comes after Sun filed his own complaint against World Liberty in April, claiming the platform improperly froze his digital assets and stripped away his voting privileges.
Sun made an initial $30 million commitment to World Liberty in November 2024. This capital injection provided critical funding for the platform’s operations and day-to-day expenses. Subsequently, he added at least $45 million in additional investments, pushing his total stake to approximately $75 million.
World Liberty’s current legal claim asserts that Sun, during his tenure as an investor, participated in short selling activities targeting WLFI tokens with the intention of driving down market prices. The platform further claims he executed straw purchases, using his controlled entities to acquire WLFI tokens on behalf of third-party investors.
Following World Liberty’s decision to freeze Sun’s token holdings due to these purported violations, Sun allegedly requested the restoration of his access. When the company declined his request, Sun pivoted to public platforms.
Social Media Statements by Sun
Sun posted on X in April, labeling World Liberty as “World Tyranny.” He described company leadership as “bad actors” and characterized the token freeze as “illegitimate and were never authorized by any fair, transparent, or good-faith community governance process.”
World Liberty maintains these public statements were inaccurate and caused material harm. The lawsuit contends Sun’s declarations damaged the company’s standing and resulted in lost commercial prospects.
World Liberty asserts its authority to freeze tokens was publicly documented and formed part of its contractual arrangements with Sun from the beginning.
Ongoing Legal Proceedings
Sun’s April legal action remains active in the court system. His complaint seeks a jury trial, financial compensation, and the unfreezing of his WLFI token holdings.
World Liberty’s counterclaim similarly requests a jury trial and seeks damages in an amount to be determined. Both legal matters may require months or years before reaching final disposition.
Sun’s legal representative had not provided a statement by Monday evening.
Sun established the Tron blockchain network in 2017. Forbes places his wealth at $8.5 billion, positioning him at 412th place on the publication’s worldwide wealth rankings.
World Liberty Financial began operations in 2024. The platform markets itself as a decentralized finance venture aligned with Donald Trump’s vision. Eric Trump, Donald Trump Jr., and Barron Trump all participated in launching the enterprise.
The Securities and Exchange Commission had conducted an investigation into Sun regarding potential securities fraud violations. That matter reached a settlement, and additional probes into crypto enterprises associated with Sun were subsequently closed.
