World Liberty Financial is hitting back at crypto billionaire Justin Sun with a defamation suit — and claims he was betting against the very token he was publicly hyping as “one of the biggest projects in crypto” as part of an alleged short-and-distort scheme.
The Florida-based decentralized finance company, launched in 2024 and backed by the Trump sons, filed the suit Monday in Miami-Dade County state court, just days after Sun sued them for fraud in California federal court.
Sun’s suit, filed April 21, claims World Liberty tried to pressure him into investing “hundreds of millions of dollars” more into its USD1 stablecoin, the company’s main product. When he refused, Sun alleges, World Liberty froze his holdings in retaliation.
But World Liberty is clapping back with a very different story. According to their complaint, Sun orchestrated a deliberate smear campaign against the company after they froze his assets.
Sun’s entity Blue Anthem began investing $30 million in $WLFI tokens starting November 2024 (he went on to invest a total of $45M and was awarded additional tokens for taking a board seat).
World Liberty says late last year it discovered Sun was allegedly violating his investment terms including making unauthorized transfers of tokens to Binance, conducting straw purchases of $WLFI on behalf of undisclosed third parties, and suspected short-selling of the token despite contractual obligations barring it — which led them to freeze his tokens.
After they froze his assets Sun publicly called $WLFI “one of the biggest and most important projects in crypto,” said he was “fully aligned with the mission,” and declared he had “no plans to sell our unlocked tokens anytime soon.”
The suit claims the ongoing praise was a money grab. Behind the scenes, Sun was warning that if World Liberty took action against him it would “light World Liberty on fire,” cause the $WLFI token price to “go to s–,” and be “bad for the whole industry.” Sun wanted hundreds of millions of dollar in a payout to stay quiet, but World Liberty refused.
On April 12, 2026, Sun went public with his claims. In a post to his 3.9 million X followers, he accused World Liberty of embedding “a backdoor blacklisting function in the smart contract” and called it “a trap door marketed as an open door.” He accused the company of acting to “treat the crypto community as a personal ATM” and denounced “the ongoing token scandals by the bad actors at WLFI.”
Three more posts followed through April 15, including a lengthy screed Sun titled “This Is World Tyranny, Not World Liberty Financial,” in which he called a new governance proposal “one of the most absurd governance scams I have ever seen” and declared World Liberty’s governance structure “dictatorship wearing the mask of a DAO.” Sun published every attack in both English and Mandarin Chinese. Combined, the posts drew roughly 4 million views and received major media coverage.
World Liberty says at least one business deal collapsed as a direct result — a potential partnership with Native Market that the company walked away from after Sun’s campaign.
“Rather than acting in good faith, Justin Sun chose to defame World Liberty — repeatedly, publicly, and to millions of followers,” said Tom Clare, a top anti-defamation attorney who has worked with Johnny Depp and Brigitte Macron, and is representing World Liberty. “We are eager to expose the falsity of Sun’s statements in court and in public.”
“We’re going to win this case based on the facts,” said Eric Hageman, an attorney at Clare Locke. “When he didn’t get his way, Sun threatened to ‘light World Liberty on fire’ and cause the $WLFI token price to ‘go to s–.’ Those were not idle words. When World Liberty refused to reverse a lawful and justified token freeze, Sun went to the press and to social media to execute on his threats. This lawsuit sends an unambiguous message: threatening World Liberty and then following through with a coordinated defamation campaign is tortious conduct, and it has consequences.”
The complaint argues Sun knew his claims were false because he had personally signed agreements disclosing World Liberty’s right to freeze tokens — and had publicly praised the project after learning of that same authority.
World Liberty is seeking compensatory and punitive damages, as well as a court order forcing Sun to retract all posts.
WLFI has drawn scrutiny for its ties to the Trump administration. Among its co-founders is Zach Witkoff, the son of Steve Witkoff, President Trump’s Special Envoy to the Middle East.
Sun did not immediately respond to a request for comment.
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