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Justin Sun Criticizes WLFI for Lack of Transparency

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Justin Sun Criticizes WLFI for Lack of Transparency

The DeFi platform of Donald Trump’s sons, World Liberty Financial (WLFI), is using the community as a “personal ATM,” stated TRON founder Justin Sun.

The entrepreneur accused the project of opaque management. According to him, the WLFI team unilaterally freezes, restricts, and confiscates the property rights of any token holder “without warning, without explanation, and without the possibility of appeal.”

“I was never informed, nor was any other investor, that World Liberty embedded a blacklist function in the WLFI token smart contract. This is the opposite of decentralization. It’s a trap disguised as an open door,” wrote Sun.

Representatives of Trump’s sons’ platform refuted the TRON founder’s words, calling the criticism “unfounded” and threatening him with legal action.

“Justin Sun’s favorite move is to play the victim while making baseless allegations to cover up his own misconduct […] We have the contracts. We have the evidence. We have the truth. See you in court, buddy,” the message reads.

The discussion flared amid criticism of WLFI from the community. Recently, it was revealed that the platform used its own governance tokens as collateral for loans.

Analysts described the model as “circular financing”: a loan is secured by an asset that the borrower itself controls. The transaction was conducted through the DeFi protocol Dolomite, co-founded by World Liberty Financial advisor Corey Kaplan.

On-chain Data Analysis

An expert under the pseudonym banteg studied on-chain data and concluded that the WLFI token deployed in 2024 initially lacked a blacklist function. However, the contract was upgradable.

The ability to block addresses appeared in version v2 in August 2025 — 11 months after Sun’s investment and a week before trading opened. In November of the same year, developers added the ability for batch redistribution (essentially confiscation), explaining it as “rescuing funds from phishing.”

The analyst also noted the flexible architecture of the WLFI vesting contract. The mechanism allows setting exact dates for the first withdrawal, configuring linear distribution, and splitting asset issuance into several stages (up to eight) for different investor groups.

However, the project did not restrict Sun with these mechanisms. He received 20% immediately at launch, and was then penalized for using part of this amount (the entrepreneur denied this). The remaining 80% of tokens have no unlocking schedule. More than seven months later, they still cannot be withdrawn.

The vesting contract allocated a separate “category 3” for the TRON founder — he is the sole user in it. The other 519 investors are in “category 1.”

Fourteen minutes before Sun’s wallet activation, the WLFI multisig set “category 3” so that 20% of his 3 billion tokens became freely transferable from the start of trading.

Upon gaining access to the assets, the entrepreneur transferred 55 million coins over three days, after which one of the controlling addresses blacklisted him. The same multisig uses 5 billion WLFI as collateral on Dolomite to attract $250 million in stablecoins.

“I urge World Liberty Financial to publicly disclose who controls the sole EOA wallet and the 3 out of 5 multisig managing the WLFI smart contract,” stated Sun.

According to Bubblemaps, since September, the value of the TRON founder’s frozen coins has already decreased by $80 million.

Back in November 2024, Sun purchased 2 billion WLFI for $30 million, becoming the project’s largest investor.

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