Justin Sun, the founder of Tron, a popular blockchain, has advised people to ignore rumors about Huobi, a crypto exchange, facing severe challenges after news of the alleged detention of some of the platform's officials. These rumors are believed to have contributed to the firm's multi-million withdrawals during the weekend, while Tron's Total Value Locked (TVL) has fallen below $2.5 billion.
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Justin Sun assures Huobi Exchange is solvent. Trouble In Paradise?
Huobi, a cryptocurrency exchange, faced significant outflows of about $64 million over the weekend. This occurred amid reports of Chinese authorities investigating its executives and the possibility of insolvency. There were rumors that Huobi's leaders were arrested on August 5th in China due to their involvement with gambling websites. It remains unclear if the recent departure of one of the exchange's top officials is connected to the ongoing investigation. Bitcoin (BTC), Tron's native token (TRX), and Huobi Token (HT) make up the majority of the outflows, with BTC comprising a third of the total. The rumors surrounding the exchange triggered serious volatility in HT's price, which fluctuated over the weekend before settling at its current level of approximately $2.66. Additionally, there are rumors of protracted financial challenges facing the exchange. According to angel investor and fintech executive Adam Cochran, there are discrepancies in the platform's Tether (USDT) holdings. Cochran believes this means that Huobi may be insolvent, indicating that the platform may not have sufficient funds to meet its obligations. Based on on-chain data, Huobi held less than $90 million of assets on August 5th, while their recent "Merkle Tree Audit" claims they hold $630 million in USDT. Justin Sun assures Huobi Exchange is solvent.
Huobi Reacts To Speculations
Justin Sun, who serves as an Advisor to the exchange, recently responded to speculations about TRON and Huobi with a series of tweets on his Twitter account. He urged users to ignore FUD and keep supporting the projects, as he believes they will thrive through continuous development. Many users responded with the figure "4," which means "Ignore FUD, fake news, attacks, etc." This is not the first time Sun and his team have faced difficulties, as there have been rumors of financial troubles in the past. However, the likely fallout from this recent event remains to be seen.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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