Crypto billionaire Justin Sun sues Trump family’s World Liberty Financial, alleging fraud
Cryptocurrency billionaire Justin Sun is taking legal action against World Liberty Financial, a crypto venture co-founded by President Donald Trump and his sons. Sun alleges that the company prevented him from selling digital tokens worth up to $1 billion illegally. The lawsuit, filed in California federal court, also accuses World Liberty Financial of pressuring Sun to invest hundreds of millions of dollars to mint USD1, the company’s stablecoin. Sun claims that the company froze his tokens after he refused to commit more money to the business.
Additionally, Sun alleges that World Liberty Financial secretly changed contractual rules regarding the sale of tokens, giving the company “blacklisting power” over who could transfer the tokens. The complaint states that the company took this power without consulting token holders or announcing the changes. World Liberty Financial’s co-founder and CEO, Zach Witkoff, dismissed Sun’s allegations as “entirely meritless” in social media posts.
Sun’s lawsuit threatens to strain his relationship with President Trump, as he revealed last year that he was the largest holder of another Trump-backed crypto token, $TRUMP. The legal action has sparked a war of words on social media, with Eric Trump calling the lawsuit ridiculous and praising the World Liberty Financial team.
In a statement on social media, Sun accused “certain individuals” of freezing his tokens, stripping him of his voting rights, and threatening to destroy his tokens without justification. He expressed his belief that President Trump would not condone such actions if he were aware of them. Sun also accused World Liberty Financial executives of leveraging the Trump brand for profit in an illegal manner.
Sun claimed that his support was instrumental in the early success of World Liberty Financial, stating that the company saw lackluster demand until he invested $45 million in tokens, which attracted more investors. However, Sun alleges that he was blocked from selling the tokens once they became tradable, causing their value to plummet by 25% since September 1.
The lawsuit also alleges that World Liberty Financial borrowed at least $75 million in stablecoins by pledging billions of its own tokens as collateral, potentially adding downward pressure on the token’s price. Sun claims that these actions indicate financial strain at the company, raising concerns about its ability to meet obligations. The legal battle between Sun and World Liberty Financial highlights the complexities and challenges of the cryptocurrency industry.
