WLFI and Justin Sun Escalate Dispute Toward Legal Battle

World Liberty Financial (WLFI) has signaled a shift toward litigation in its ongoing conflict with Tron founder Justin Sun, following a series of public accusations regarding the project's management of decentralized finance (DeFi) assets. The project took to social media to challenge Sun's credibility, claiming to possess evidence and contracts that would justify a court appearance. The tension peaked after Sun alleged that the WLFI team treated its user base as a "personal ATM." This accusation follows a move by WLFI to deposit 5 billion tokens as collateral on the Dolomite lending platform to secure approximately $75 million in stablecoins. Sun characterized these actions as illegitimate attempts to extract fees from the crypto community. Sun has further accused the project of implementing undisclosed backdoor controls over user assets and freezing investor funds without due process. This follows a previous incident in September where WLFI froze Sun's tokens, alleging an attempt to cash out early—a claim Sun denies and asserts is contradicted by on-chain data. The fallout represents a significant breakdown in the relationship between WLFI and one of its most prominent early backers. The dispute marks a sharp reversal from previous public support, including praise from WLFI co-founder Zak Folkman during the Consensus Hong Kong event, where the project was described as a monumental move for the crypto community.