WLFI Threatens to File a Lawsuit Against Sun Yuzhou: “See You in Court.” Controversy Escalates After Token Contract Allegedly Hides a Blacklist Backdoor

A conflict between World Liberty Financial (WLFI), a crypto project backed by the Trump family, and Justin Sun, the founder of Tron, escalated across the board on April 12. WLFI publicly threatened to sue Justin Sun on X, ending with “See you in court pal.” The dispute stems from Sun’s accusation that a blacklist backdoor capable of freezing user funds is hidden in the WLFI token contract.

Sun’s accusation: Hidden backdoor blacklist

Sun claims that WLFI “secretly embeds a backdoor blacklist feature” into the smart contract deployed for WLFI tokens, enabling the project team to freeze, control, or seize users’ funds, which violates the basic principles of decentralization.

The incident traces back to September 2025. At the time, WLFI froze Sun’s wallet address, locking about 540 million WLFI tokens, on the grounds that it detected what appeared to be a sell-off of tokens transferred to an exchange. These tokens remain locked to this day, and Sun says he has suffered about a $70 million paper loss as a result.

WLFI’s counterattack: Accusing Sun of playing the victim

In its response, WLFI accused Sun of “playing the victim while covering up its own improper conduct with baseless accusations.” The WLFI team suggested that Sun violated the terms of an investment agreement, but did not spell out any details, only stating it would resolve the matter through legal avenues, ending with “See you in court.”

From the biggest investor to a courtroom opponent

Sun was one of WLFI’s largest external investors, investing $75 million. He has recently gone even further by criticizing WLFI for treating users as a “personal ATM,” referring to the WLFI team’s operation of borrowing $75 million in stablecoins on Dolomite using 5 billion WLFI tokens.

The dispute highlights deeper governance issues in politically connected crypto projects. A project that claims to be decentralized retains the ability to freeze user funds in its token contract; the assets of its largest investor were locked unilaterally for more than half a year, and the solution was public legal threats rather than on-chain governance—which sharply contrasts with DeFi’s core ethos.

This article: WLFI threatens to sue Justin Sun—“See you in court”—the blacklist backdoor controversy in the token contract escalates. First appeared on ChainNews ABMedia.