Under the plan, tokens held by insiders — such as team members, advisors and partners — would face a two-year lockup followed by a three-year gradual release, alongside a 10% token burn upon opting in. Early supporters would face slightly shorter vesting terms but no burn. In total, up to 4.5 billion tokens could be permanently destroyed.

Holders who do not accept the new terms would remain locked indefinitely, per the proposal.

Sun was not alone in pushing back. Simon Dedic, founder of Moonrock Capital, said early investors had effectively been “rugged.”

“All the $WLFI early investors who thought they were sitting on solid profits just got rugged, by the Trump family themselves,” Dedic wrote on X, adding that the move appeared to give the project another chance to extract value from investors. He also criticized what he described as “blatant misconduct” with little effort to conceal it.

A World Liberty Financial spokesperson told CoinDesk that the proposal “was designed to further align all the participants in the WLFI ecosystem for the long-run,” adding that it aims to “optimally ensure long-term participation in our ecosystem and help ensure healthy market supply.”

Escalating feud

The backlash marks the latest episode in the breakdown in relations between Sun and the project.

Earlier this week, WLFI threatened legal action, saying it had “contracts” and “evidence” after Sun accused the team of exploiting users through DeFi transactions.

The dispute has been building for months. In September, WLFI blacklisted a blockchain address linked to Sun that held about $107 million worth of its governance tokens at the time. That marks a sharp reversal from late 2024, when Sun was a key backer, investing $30 million in WLFI tokens and taking on an advisory role to help support the project.

Tensions intensified after WLFI deposited 5 billion of its own tokens into lending protocol Dolomite — where one of its advisers is a co-founder — and borrowed roughly $75 million in stablecoins. The tokens fell 12% to a record low the next day, after which Sun publicly accused the project of treating users as “personal ATMs,” triggering the latest legal threats.

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