World Liberty Financial, a cryptocurrency company co-founded by Donald Trump Jr., Eric Trump, and entrepreneurs Zachary Folkman and Chase Herro, filed a defamation lawsuit against crypto billionaire Justin Sun on May 4 in Miami-Dade County, Florida. The lawsuit accuses Sun of orchestrating a public smear campaign that harmed the company’s reputation and seeks unspecified damages along with a public retraction of Sun’s statements.
Lawsuit claims and counterclaims
World Liberty Financial alleges that Sun engaged in a “scorched earth” campaign against the company after it froze tokens associated with one of Sun’s firms, in an effort to protect World Liberty and its token holders. The company claims that Sun bet against its crypto tokens, traded under the $WLFI ticker, and used third parties to covertly purchase tokens to conceal his identity. According to the lawsuit, Sun sought to pressure World Liberty into paying hundreds of millions of dollars and threatened litigation to damage the company.
After World Liberty refused to comply with these demands, the lawsuit says, Sun escalated his efforts by making false allegations on social media. These included claims that World Liberty treated the crypto community as “a personal ATM” and that its governance practices were improper. The company also accuses Sun of amplifying falsehoods through online influencers and fake social-media bot accounts. These posts reportedly reached millions of viewers and generated broad media coverage, further damaging World Liberty Financial’s standing.
In response, Sun dismissed the defamation suit as “a meritless PR stunt” on social media platform X, asserting he stands by his actions and expects to prevail in court. Sun’s legal team did not immediately comment on the lawsuit.
Company background and market context
World Liberty Financial launched in 2024 with the backing of the Trump family and other entrepreneurs. Its digital tokens have since lost about 81% of their value, trading near 6 cents as of early May 2026, according to CoinMarketCap.
Justin Sun is the founder of the blockchain platform Tron and holds a net worth of nearly $12 billion, per the Bloomberg Billionaires Index. He gained media attention in 2024 for purchasing conceptual art valued at $6.2 million.
Why it matters
This lawsuit represents an escalation in the conflict between World Liberty Financial and one of its key investors amid declining token values and allegations of mismanagement. The case highlights ongoing legal and reputational risks in the volatile cryptocurrency sector, where disputes among major stakeholders can impact investor confidence and market stability.
Sources
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