World Liberty Financial co-founder defends transparency of smart contracts amid Justin Sun lawsuit

World Liberty Financial (WLF) co-founder Zak Folkman is defending the project against a lawsuit filed by Tron founder Justin Sun, who alleges that WLF embedded a hidden "backdoor" in its smart contracts. Sun claims this function was used to freeze approximately $107 million of his WLFI tokens. Folkman maintains that the contract code was public and auditable by anyone, arguing that transparency in DeFi relies on the "code is law" principle where investors are responsible for auditing on-chain functions.

The conflict centers on whether the blacklisting function was sufficiently disclosed to investors. While WLF states such mechanisms are essential for KYC and AML compliance, Sun contends that he was unfairly targeted despite his role as a major investor and advisor. The case highlights a broader debate in the DeFi space regarding whether the mere availability of on-chain code constitutes adequate disclosure for complex financial features.

(Source：Crypto Briefing)