- Justin Sun tried to quell investors’ worries when he posted a tweet addressing rumors
- The crypto billionaire downplayed the rumors and simply called it FUD
- Sun also urged the crypto community to ignore the rumors
Justin Sun, the crypto entrepreneur and founder of the blockchain DAO ecosystem TRON finally speaks up after rumors made rounds online alleging Houbi, the centralized crypto exchange platform based in Seychelles is insolvent and some of its executives are currently detained and under investigation in China.
Sun, who is known as an adviser to Houbi, urged the crypto community to ignore the rumors alleging that the exchange is grappling with a lot of issues, which likely played a role in the multi-million outflows from the exchange over the weekend.
“Ignore FUD, keep building,” Sun said in a tweet.
“TRON and Huobi will thrive through continuous development,” he added before saying, “Trust in our vision and community efforts for a stronger future. Perseverance guarantees success!”
In another tweet, the crypto billionaire seemingly took a dig at rumormongers when he said one should simply “share a document with Chinese signs” and “say whatever you want” to spread a rumor.
But Sun’s recent tweet was slammed by Adam Cochran, a fintech executive, angel investor and renowned crypto Twitter analyst.
“Justin telling people to not worry about Huobi, meanwhile at the start of the claims of employees being investigated, he withdraw $60M from Huobi and started sending his assets to a Binance deposit wallet,” Cochran said, adding, “he wants you to have faith, but he doesn’t.”
Over the weekend, Chinese crypto reporter Colin Wu shared on X (formerly Twitter), that Chinese authorities detained “a large number of senior executives of offshore” crypto marketplaces for “allegedly providing fund payment and settlement services for gambling websites.”
Wu also said, “According to Bitrace research, online gambling funds transferred directly or indirectly to offshore exchanges in the past year have exceeded 7.6 billion USDT.”
He also noted that “At present, the major offshore exchanges are all founded by Chinese. Their founders are located in Dubai or Singapore, but most of their employees are located in China.”
While Wu did not drop the name of the exchange, Cochran revealed that the exchange in question is Houbi.
In an X thread, Cochran said that “When Binance heard that Huobi/Tron employees were being investigated in relation to actions at Huobi, they started slamming the 3CRV USDT sell into DAI to mitigate their risk,” adding, “Because Huobi is deeply insolvent.”
The crypto analyst also pointed out the discrepancies in Huobi’s Tether (USDT) holdings and suggested that the exchange may not have sufficient funds to cover its obligations.
And although Houbi claimed that it holds $630 million in USDT, Cochran disproved it by pulling data from the multi-chain TVL stats dashboard Defi Llama, which showed that the assets are below $90 million.