Key Takeaways
- Tron founder Justin Sun labeled WLFI’s governance proposal as “one of the most absurd governance scams” in crypto
- More than 62 billion WLFI tokens would face lockup periods extending up to four years under the new terms
- Token holders who decline the proposal face indefinite lockups with no release mechanism
- Simon Dedic from Moonrock Capital accused the Trump family of executing a “rug pull” on early backers
- World Liberty Financial defends the measure as essential for long-term ecosystem alignment
World Liberty Financial, the cryptocurrency initiative backed by Donald Trump, is facing intense scrutiny following the release of a contentious governance proposal that would impose years-long lockup restrictions on early investor tokens — or freeze them permanently for those who decline.
The controversial proposal, published on WLFI’s official governance platform this Wednesday, would subject over 62 billion WLFI tokens to stringent new vesting schedules. Team members, strategic advisers, and protocol partners would experience a two-year complete lockup period, followed by an additional three-year gradual token release schedule. Early supporters receive marginally more favorable terms but would still endure multiple years of restricted token access.
Those who opt out of accepting these revised conditions would see their holdings locked permanently, with the proposal offering no defined mechanism for future token retrieval.
The plan additionally includes provisions for burning as many as 4.5 billion tokens, while participants who accept the terms would face a 10% token burn penalty upon enrollment.
Justin Sun, the entrepreneur behind Tron and among WLFI’s most substantial investors, unleashed scathing criticism of the proposal. In a social media statement on X, Sun characterized the initiative as “one of the most absurd governance scams I have ever seen.”
This Is World Tyranny, Not World Liberty Financial — Here's Why
This proposal has been packaged as a "governance alignment signal" and a "long-term commitment," but strip away the packaging and what you have is one of the most absurd governance scams I have ever seen. Let me… https://t.co/sJhFMnLWsJ
— H.E. Justin Sun 👨🚀 🌞 (@justinsuntron) April 15, 2026
Sun maintains he controls approximately 4% of World Liberty’s total supply, though his holdings are presently immobilized. According to Sun, this freezing mechanism has effectively barred him from participating in the governance vote.
He further questioned the actual distribution of control within the protocol. Sun highlighted that unidentified wallet addresses — including a multi-signature wallet capable of vetoing community votes and another account with user blacklisting capabilities — wield disproportionate influence over protocol decisions.
“This proposal is not governance,” Sun declared in his statement. “It is an exercise of power by the selected few.”
Mounting Opposition From Major Investors
Sun’s objections found support among other prominent cryptocurrency figures. Simon Dedic, who founded Moonrock Capital, alleged that early investors suffered what amounts to a “rug pull” orchestrated by the Trump family.
In his X platform commentary, Dedic suggested the maneuver represents “another shot at squeezing the same lemon,” with timing that conveniently aligns with the duration remaining in Donald Trump’s presidency.
Dedic further condemned what he described as “blatant misconduct” conducted with minimal attempts at concealment.
Long-Standing Tensions Between Sun and WLFI
The conflict between Justin Sun and WLFI traces its origins to September of last year, when the project blacklisted a blockchain address associated with Sun containing approximately $107 million worth of governance tokens.
This antagonistic turn represented a dramatic shift from the relationship’s earlier phase in late 2024, when Sun committed $30 million to WLFI and assumed an advisory position within the organization.
Relations deteriorated further when WLFI deposited 5 billion of its native tokens into Dolomite, a lending protocol whose co-founder serves as one of WLFI’s advisers, subsequently borrowing roughly $75 million in stablecoins against that collateral. The token’s value plummeted 12% to an unprecedented low within 24 hours of this transaction.
Sun publicly condemned the project for using community members as “personal ATMs.” WLFI countered these allegations with warnings of potential legal proceedings.
A World Liberty Financial representative informed CoinDesk that the proposal “aims to optimally ensure long-term participation in our ecosystem and help ensure healthy market supply.”
The voting period for this contentious proposal is scheduled to commence imminently and will remain open for seven days. WLFI tokens currently trade near 8 cents, representing a decline exceeding 40% year-to-date and a precipitous drop of over 75% from the token’s record high of 33 cents.
