Trump's Crypto Empire Clashes with Its Largest Backer

Late in 2024, crypto billionaire Justin Sun was credited with reviving interest in the Trump family's decentralized finance project, World Liberty Financial (WLFI), but this week it froze his investment, igniting scrutiny of the venture during its token's long-touted trading debut. Sun, the founder of the Tron blockchain, made a $30 million investment before the presidential election and later increased it to $75 million. World Liberty executives in February credited Sun with generating the interest that enabled the project to meet its early fundraising goals. WLFI began trading on public exchanges on Monday, with Sun stating he had no intention of selling, even though 20% of his holdings were available for trading. The token's value climbed quickly but then fell, a common pattern as early investors release large amounts of supply onto the market. On Thursday, Sun explained on social media why he had transferred some of his holdings to other wallets, arguing that the moves should have had no impact on WLFI's trading price. Late Thursday night, he confirmed his tokens had been frozen by World Liberty.

World Liberty had put locks on several wallets that had bought WLFI, restricting the ability to sell, move, or interact with the tokens. Galaxy Digital found over 200 addresses that saw their WLFI tokens frozen at various times before and after trading began. Sun wrote on X that as an early major investor, he had contributed not only capital but also trust and support for the project's future and called for his tokens to be unlocked to move forward together toward success. World Liberty has not responded to repeated requests for comment from Axios or to Sun’s posts. The Trump family’s stake in WLFI has grown significantly, with the Trumps holding roughly 15.75 billion tokens, worth more than $3.4 billion, making crypto the most significant source of Trump's fortune. The Trumps overall control just under a quarter of the roughly 100 billion WLFI coins created last year, giving them claim to holdings worth roughly $5 billion as of Tuesday's prices. Trump and his sons also receive a cut of the revenues generated by coin sales, an arrangement that has already helped bring in more than $500 million.

WLFI is a governance token designed to allow gradual transfer of control to the public through token voting. Unlike stocks, these tokens do not confer equity in the company creating the project but can be used to influence the project's agenda. The Trump family launched World Liberty Financial in the middle of the presidential campaign last year, drawing questions about potential conflicts of interest as he became entangled in an industry he would be poised to regulate. Investors voted in July to allow early purchasers, excluding founders like the Trump family, to sell up to 20% of their holdings of WLFI. As of Tuesday, WLFI was trading at around $0.22, having sunk roughly 50% since the start of trading on Monday. The token's price drop indicates tepid demand, but it is still trading at a higher price than what many early buyers would have paid, putting them in line for profit.

The Trump administration has consistently dismissed criticism about Trump’s crypto dealings, even as the president has dramatically shifted the government's posture toward the industry. White House press secretary Karoline Leavitt stated that the administration’s policies were "driving innovation and economic opportunity for all Americans" and called the media's attempts to fabricate conflicts of interest as irresponsible. Trump, who vowed to make the U.S. the "crypto capital of the world," has advocated a more hands-off approach. Last month, the Department of Justice disbanded its task force focused on crypto crimes. Financial regulators have also disavowed the Biden administration's guidance on securities, with SEC Chair Paul Atkins stating that most crypto assets are not securities and that a regulatory framework is needed to allow these products to flourish within American markets.

Justin Sun’s recent actions and the response from World Liberty Financial highlight the tensions that can arise in governance token models, where centralization and control rights may conflict with the decentralized ideals promoted. The incident underscores the complexities of managing expectations in a market that values both innovation and transparency. As the project moves forward, the community will likely continue to monitor how governance and control are balanced against the principles of decentralization and autonomy.

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/)