Justin Sun claims World Liberty concealed foreign ownership details prior to invoking its UAE citizenship, which was used to challenge an American federal court’s authority.
Justin Sun accused World Liberty Financial, the crypto initiative backed by President Donald Trump, of masking UAE citizenship to dodge a federal lawsuit filed by him.
The Tron founder stated on Nov. 3 that sanctions against World Liberty Financial and its legal team had been requested by his lawyers after foreign ownership ties were disclosed months into litigation over his $45 million investment.
The revelation sparked another controversy around the president’s cryptocurrency enterprise, which had been promoted as a domestic financial venture despite a reported $500 million stake held by an Abu Dhabi-backed entity linked to a high-ranking UAE official.
Sun accused World Liberty of selectively leveraging its national identity depending on whether capital was being raised or legal claims were being defended in court.
He wrote on X:
“World Liberty was proudly American when it was selling tokens. It discovered its UAE roots only when it needed a way out of an American federal courtroom.”
The allegation followed an August court filing in which ownership disclosures were expanded by World Liberty from a single entity to 22, detailing ties to Florida, Delaware, Puerto Rico, and the UAE.
Sun alleged that Florida citizenship was initially disclosed by the firm, despite rules requiring full disclosure regarding the members of its ownership structure.
The updated filing surfaced six days after an Aug. 20 hearing regarding World Liberty’s push to transfer the investor dispute into arbitration. Sun noted that certain claims were slated by the judge to remain in open court, whereas others could move forward through arbitration.
World Liberty subsequently argued that federal court jurisdiction was invalidated by its UAE citizenship, since foreign entities were represented on both sides of the lawsuit.
Trump’s $500 Million UAE Deal Faces Fresh Scrutiny
Sun, who sued the firm in April over claims that his investment was fraudulently induced and his tokens unlawfully frozen, noted that hundreds of thousands of dollars had already been spent by his legal team fighting World Liberty’s arbitration request.
He accused the firm of omitting ownership details that could have had court jurisdiction established right at the onset of the lawsuit.
The ownership dispute carries broader political weight as scrutiny was already drawn to World Liberty’s UAE connections over potential conflict-of-interest concerns involving the president’s family.
In January 2025, just days before Trump’s inauguration, a $500 million agreement was reached for a 49% stake in World Liberty to be acquired by an investment vehicle backed by UAE National Security Adviser Sheik Tahnoon bin Zayed Al Nahyan.
The deal, signed by Eric Trump, funneled roughly $187 million to Trump family-controlled entities, according to reporting that was published on the transaction.
Sheikh Tahnoon, a brother of the UAE president, also manages a vast investment empire with major stakes held in artificial intelligence and advanced technology.
The deal subsequently drew heavy scrutiny as access to advanced American AI chips was expanded for the UAE by the Trump administration. Democratic lawmakers questioned potential conflicts between the president’s commercial interests and US foreign policy priorities.
World Liberty has rejected claims that government decisions were influenced by its funding arrangement. President Trump also stated that he was unaware of the deal and that his sons manage the business.
The company’s public messaging has nevertheless placed clear emphasis on its identity as a U.S.-based venture.
Its Gold Paper declares that World Liberty is not organized offshore, depicting it as a U.S. corporation focused on bringing decentralized finance into American markets.
Such assertions are not necessarily incompatible with foreign ownership. A U.S.-registered enterprise can still attract overseas investors while foreign citizenship is acquired for the purposes of federal diversity-jurisdiction rules.
The reported UAE investment also followed Sun’s initial November 2024 token purchase, and public knowledge of the deal was established months before World Liberty amended its court disclosure.
The unresolved issue in Sun’s sanctions request centers on why pertinent foreign ownership connections were not identified by the company when federal litigation originally began.
Sun contends that accurate information was either withheld by World Liberty from its attorneys or that its legal team failed to thoroughly investigate the company’s ownership structure.
World Liberty previously rejected Sun’s fraud allegations, while misconduct claims were leveled against him by the firm in a separate defamation lawsuit.
Sun stated that he would pursue the original dispute in California state court once his sanctions request is addressed by the federal judge, leaving the court to determine whether penalties are warranted against the firm or its legal team over the delayed ownership disclosure.
