孙宇晨起诉WLF文件：四个「离谱」细节浮出水面

Original author: Aleks Gilbert

Original translation: Chopper, Foresight News

Cryptocurrency tycoon Justin Sun hopes to maintain good relations with Donald Trump but has taken a hardline approach against the President's business partners.

In a lawsuit filed Tuesday, Sun accuses World Liberty Financial executives of fraud, theft, and other illegal acts.

The allegations are not couched in lengthy, dry legal jargon. Instead, the complaint emphasizes that World Liberty Financial is facing "collapse and potential bankruptcy" and is struggling to operate.

Sun directs the most damaging content at one person: World Liberty co-founder Chase Herro, whom the complaint describes as a habitual scammer and tax evader.

Some details have been previously reported. Claims such as World Liberty's imminent collapse are purely speculative. Even so, the lawsuit will provide ample ammunition for the company's critics, including disgruntled investors and opposition lawmakers lying in wait.

When asked about the lawsuit on Wednesday, a spokesperson for World Liberty Financial pointed to a statement made by the company's co-founder on social media.

The company's CEO, Zach Witkoff, called the lawsuit "a desperate attempt by Justin Sun to divert attention from his own misconduct."

Herro did not directly respond to the lawsuit. He shared Rudyard Kipling's inspirational poem and Witkoff's statement, captioning it: "Building is never easy, it's often full of successes and failures, like a giant maze you must navigate."

Below are the four most noteworthy allegations and details from the 52-page complaint.

Herro's Past

Mainstream media reports have previously outlined Herro's checkered history, including a prison record, inflammatory remarks, questionable business dealings, and involvement in a 2024 DeFi protocol that lost nearly all its crypto assets in a hack.

The complaint includes all of the above while adding several new details.

"Herro's business misconduct was so egregious that, around 2010, aggrieved customers and partners created a website called ChaseHeroScam.com," the complaint reads.

The site was inaccessible on Thursday, and DL News could not verify whether the content alleged in Sun's lawsuit existed on that site.

The complaint states that Herro has been subject to four tax lien orders from courts, and a property he owns in Florida was issued a tax deed.

The complaint also alleges that Herro "publicly bragged" about visiting Little St. James Island, the private island owned by disgraced financier Jeffrey Epstein. However, the complaint provides no evidence for this claim, and DL News is currently unable to verify whether Herro made such statements.

"Secret" Upgrades

Since the project's early days, holders of the World Liberty Financial governance token, WLFI, have had very limited authority.

According to company documents, token holders have no power over World Liberty Financial's operations but can vote on upgrades to the underlying technology.

Sun alleges that World Liberty executives broke their promise by unilaterally and quietly completing two technical upgrades last year without any governance vote or disclosure to WLFI holders.

These upgrades are said to have given World Liberty Financial the ability to freeze and seize WLFI tokens, a power that has allegedly been wielded against Sun himself. Sun characterized this upgrade as destructive.

"Although the upgrade is visible on the public blockchain, World Liberty Financial hid it deep within the code, failing to inform token holders of the function's existence or its potential impact," the complaint reads. "The company secretly added an arbitrarily enforceable 'blacklist' function."

World Liberty Financial stated that the freezing function is only used to protect user rights.

In his statement, Witkoff said: "Sun's misconduct forced World Liberty Financial to take action to protect itself and its users. World Liberty Financial will continue to take all necessary steps to safeguard the community ecosystem."

The TRUMP Meme Coin

World Liberty Financial's allegations regarding Sun's supposed misconduct have been vague. However, Sun claims the company's executives provided a detailed explanation in private.

The reasons include: executives determined that Sun's sale of tokens caused WLFI's price to drop by 40%, that he improperly bought tokens on behalf of others, and that he violated the "token purchase agreement."

But the complaint points to another trigger for the conflict: the TRUMP Meme coin.

"World Liberty Financial stated that one reason for freezing the WLFI tokens was its displeasure over Sun purchasing $100 million worth of TRUMP tokens, issued by another Trump-endorsed project," the complaint reads. Part of the next line is redacted, but it concludes by noting that something (likely the purchase of TRUMP tokens) "was pre-approved by a member of the Trump family, who is also a partner in both projects."

The complaint does not explain why World Liberty Financial would object to Sun buying TRUMP coins.

Money Transmission Violations

Last year, two crypto developers were sentenced to prison for operating unlicensed money transmission businesses, and another was convicted on the same charge but has not yet been sentenced.

Sun alleges that World Liberty Financial also violated this regulation.

The complaint argues that World Liberty Financial became a money transmitter by granting itself the power to transfer tokens on behalf of others.

"World Liberty's highly centralized control over WLFI tokens is not only completely antithetical to the ideals of DeFi but also indicates that it is conducting money transmission business without being registered or licensed, violating numerous U.S. federal and state criminal laws."