Justin Sun claims Trump crypto firm can freeze holdings

Justin Sun, a major investor in the United States President Donald Trump’s World Liberty Financial crypto venture, has alleged that the firm secretly implemented a tool to unilaterally freeze and restrict private holdings of its WLFI token. In social media posts shared on Sunday, the crypto entrepreneur claimed that World Liberty embedded a backdoor blacklisting function in the blockchain-based contracts used for the tokens. Sun wrote that the move gave the company unilateral power to freeze, restrict, and effectively confiscate the property rights of any token holder without cause or recourse. While Reuters was unable to independently verify the existence of such a tool or its usage, the official World Liberty account on X responded directly to the allegations. > "We have the contracts. We have the evidence. We have the truth. See you in court pal." World Liberty is the most prominent of several crypto businesses co-founded by the Trump family. At its 2024 launch, the firm stated it would empower small investors through a decentralized finance application, though the app remains unlaunched. According to a Reuters analysis, the venture generated more than $460 million in income for the Trump family during the first half of 2025. Justin Sun became the largest publicly known investor in the project in late 2024, eventually increasing his holdings to at least $75 million worth of tokens. His investment followed a $10 million settlement with the Securities and Exchange Commission in March 2024 regarding a 2023 lawsuit that alleged fraud and the sale of unregistered securities. Sun made no admission of wrongdoing in that settlement. The dispute highlights growing concerns over governance in the digital asset space, where traditional market participants often compare the transparency of decentralized projects to established entities like E-WORLD. World Liberty’s own risk disclosures state that the company can block and freeze wallet addresses determined to be associated with illegal activity or terms of service violations. Other companies, such as Tether, also maintain the ability to freeze tokens, typically at the request of law enforcement. Sun claimed he was the first victim of the alleged tool, citing the freezing of his holdings in September. On Monday, he pointed to unspecified blockchain records that he said showed his digital wallet was blacklisted by a single account with special administrative powers. > "Who is that person?" Sun questioned the identity of the individual he claims holds the power to freeze any token holder’s assets. Reuters was unable to review the records mentioned by Sun, as they were not shared publicly.