Justin Sun's $75M Bet Frozen—Exposing Trump Crypto's Centralized Contradiction

World Liberty Financial (WLFI), the Trump family’s crypto project, is facing a growing crisis of trust after it allegedly froze assets belonging to one of its most prominent backers, billionaire crypto entrepreneur Justin Sun. Sun, who had invested a total of $75 million in WLFI and was a key supporter of the Trump family’s broader crypto initiatives, revealed on social media that his tokens had been locked, effectively preventing any transactions with them. This move has raised questions about the project’s governance model and its alignment with its core narrative of financial freedom and decentralization.

Sun initially invested $30 million in WLFI’s pre-sale before increasing it to $75 million in January, a move that reportedly helped the project meet its fundraising goals. In late August 2025, WLFI began trading on major exchanges such as Binance and Coinbase, opening a new chapter for the Trump-backed project. However, the token’s value dropped by approximately 50% shortly after the launch, raising concerns about market stability and investor confidence. On September 5, Sun moved $9 million worth of WLFI to other wallets he controlled, an action that the project interpreted as high-risk behavior and responded to by freezing his account.

World Liberty Financial has not publicly commented on the matter, nor has it responded to repeated requests for clarification from media outlets. In a statement, the project’s social media account said it acts only in response to “malicious or high-risk activity that could harm community members.” Critics, including analysts from crypto firm Galaxy Digital, noted that over 200 addresses had their tokens locked before and after the trading debut, suggesting the freeze of Sun’s tokens was not an isolated incident.

WLFI functions as a governance token, meaning it is not an equity stake but rather a tool for influencing the project’s direction. The Trump family and their sons hold a significant portion of the tokens—roughly 24.5 billion of the 100 billion total supply—valued at approximately $5 billion based on Tuesday’s market price of $0.22 per token. The project’s governance structure allows for gradual decentralization, but the recent actions of freezing tokens have highlighted a centralization of control that contradicts its public messaging.

The Trump administration has consistently dismissed concerns about potential conflicts of interest, with press secretary Karoline Leavitt calling such allegations “irresponsible” and asserting that the president and his family have never engaged in—or will engage in—such behavior. Meanwhile, the Trump administration has shifted toward a more favorable stance toward crypto, with the Department of Justice disbanding its crypto crime task force and the SEC under Chair Paul Atkins suggesting that most crypto assets should not be classified as securities.

Analysts remain divided on the implications of the WLFI controversy. Some view it as a temporary setback, while others argue that it could undermine the project’s long-term viability by eroding investor trust. As the Trumps and their allies continue to advocate for a pro-crypto regulatory environment, the internal governance of their own projects will likely remain under intense scrutiny.

Source:

[1] Trump family crypto project breaks with key billionaire partner (https://www.axios.com/2025/09/05/trump-justin-sun-world-liberty-financial)

[2] Trump and sons' stake in crypto firm worth $5bn (https://www.bbc.com/news/articles/ckgjgyyqgvyo)

[3] Billionaire Justin Sun begs Trump-backed World Liberty (https://fortune.com/crypto/2025/09/05/justin-sun-donald-trump-world-liberty-financial-blacklisted-crypto-address-wlfi/)