Justin Sun Accuses Trump-Linked Crypto Firm of Secret Account Freezing
Crypto entrepreneur Justin Sun has publicly accused World Liberty Financial, a prominent cryptocurrency venture co-founded by the Trump family, of secretly implementing a tool to unilaterally freeze his holdings of its WLFI tokens. In social media posts on Sunday, Sun claimed the company embedded a "backdoor blacklisting function" in its blockchain-based contracts, granting it the power to restrict assets without cause or recourse.
Allegations of Unilateral Control
Sun, who is the largest publicly known investor in World Liberty Financial, stated that this function allows the company to "freeze, restrict, and effectively confiscate the property rights" of any token holder. He pointed to the freezing of his own holdings in September as evidence, alleging he was the "first and single largest victim" of this mechanism. Sun cited unspecified blockchain records to support his claim that a single individual at the firm had administrative powers to blacklist digital wallets.
Company Response and Legal Threats
In response, World Liberty Financial's official account on X posted a defiant message: "We have the contracts. We have the evidence. We have the truth. See you in court pal." The company previously stated it did not seek to blacklist anyone and acted only in response to "malicious or high-risk activity" that could harm community members. A spokesperson for the firm directed inquiries to its social media posts, while Sun did not offer further comment.
Background and Regulatory Context
World Liberty Financial, launched in 2024, is among several lucrative crypto businesses associated with the Trump family, generating over $460 million in income for them in the first half of 2025, according to Reuters analysis. Sun invested tens of millions of dollars in the venture in late 2024, later increasing his holdings to at least $75 million, and was named an adviser. He described his investment as a vote of confidence in the Trump family's "excellent project."
The firm's risk disclosures acknowledge its ability to block and freeze wallet addresses linked to illegality or terms violations, a practice also employed by other crypto companies like Tether. However, Sun's allegations raise questions about transparency and control in decentralized finance. In March, Sun settled a Securities and Exchange Commission lawsuit for $10 million over fraud and unregistered securities allegations, without admitting wrongdoing. The SEC declined to comment on rules surrounding token freezes, highlighting the regulatory grey area for cryptocurrencies in the United States.
