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TRON Crisis: Sun’s $260M Wallet Mystery Unfolds

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TRON founder Justin Sun is in the limelight after a major stablecoin issuer ceased USDC support on the blockchain. As the crypto community speculates over the next course of events, data analysis tool Lookonchain reported that an anonymous whale suspected to belong to the crypto entrepreneur deposited 90 million USDT to Binance. Subsequently, the wallet known as “0x7a95” withdrew 10,136 ETH [$29.76 million] and 40 million USDT from the crypto exchange. So far, the whale has bought 91,316 ETH worth nearly $260 million from Binance and other DEXs.

In the past 32 hours, another unknown wallet named TWGHNc” bought a total of 54,721 ETH ($154.4M) from Binance and DEX. This wallet also withdrew 500 million USDT from HTX a day before. “Maybe no one except Justin Sun can withdraw so much USDT from HTX, a crypto exchange affiliated with him,” Lookonchain stated.

Interestingly, the transactions of wallet “TWGHNc” are highly consistent with “0x7a95.” “This seems like too much of a coincidence,” Lookonchain noted.

TWGHNc deposited 5.41million USDT to HTX on Feb 7 and 0x7a95 withdrew 1,100 ETH from HTX on Feb 8. TWGHNc deposited 50M USDT to Binance on Feb 1 and 0x7a95 withdrew 9,959 ETH from Binance on Feb 12. TWGHNc deposited 200 million USDT into Binance on Feb 18. On the same day, 0x7a95 withdrew 29,875 $ETH ($84.3M) and 100M $USDT from Binance.

While there is a strong possibility that the wallet might be related to the TRON founder based on on-chain data, Lookonchain stated that there is no definitive proof that it belongs to him and that “everyone can have their own opinions.”

TRON On The Verge Of Regulatory Chokehold?

The new developments come after stablecoin issuer Circle announced its decision to withdraw support for its USDC [US Dollar Coin] token on the Tron blockchain network. Users have until Feb 25 to move their USDC tokens on the TRON blockchain to other networks. “Our decision to discontinue support for USDC on TRON is the result of an enterprise-wide approach that involved the business organization, compliance, and other functions across our company,” as per the official statement.

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TRON Crisis: Sun's $260M Wallet Mystery Unfolds 2

Circle’s decision has sparked speculation that both TRON and Sun are next in line of fire over compliance-related issues. Already battling the SEC, TRON Foundation and its founder filed for dismissal of SEC claims, arguing improper application of securities laws, overstepping jurisdiction, and lack of fair notice.

The regulator filed suit against the defendants in March 2023 for selling unregistered securities and for the sale and promotion of TRX [TRON] and BBT [BitTorrent].

Circle Ceases USDC Support on TRON: TRX Holds Strong Amid Transition

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Circle, a leading financial technology company, has announced the discontinuation of USDC (USD Coin) support on the TRON blockchain. This transition will be carried out gradually, with immediate effect on minting USDC on TRON ceasing. However, transfers and redemptions of USDC on TRON will continue without disruption until February 2025, as detailed in an official blog post by Circle.

Circle Mint customers can transfer their USDC holdings on TRON to other compatible blockchains or redeem them directly into fiat currency through Circle. In the same way, retail owners and non-Circle customers can move USDC to alternative blockchains using numerous global services such as retail exchanges or brokerages and then redeem it for fiat currency.

The move is part of a larger evaluation within the organization, involving business and compliance, among other functions within Circle, to stop USDC support on TRON. However, Circle is committed to further expanding USDC’s reach to blockchains, securing the broadest development choice for developers, and securing a network experience for USDC holders whereby USDC remains redeemable at a 1:1 ratio with US dollars.

TRON Technical Analysis Indicates Bullish Trend

However, the market condition of TRON is relatively strong. The current price is 0.140238, with a 24-hour trading volume of the cryptocurrency around 700.11 million, and its market cap is 12.95 billion. TRON’s price change over the last 24 hours is 2.10%.

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Circle Ceases USDC Support on TRON: TRX Holds Strong Amid Transition 5

The TRX market has shown a consistent uptrend after breaching levels of resistance at $0.128 and $0.132; in contrast to a new multi-week high of $0.1400, it is presently consolidating in gains. Trading analysis has witnessed the TRX maintain levels over the 23.6% Fib retracement from its latest swing low of $0.1309 to the high of $0.1400.

In the meantime, TRX is exchanging above $0.1350 and the 100 SMA (4 hours) by shaping a bullish trend line, developing a support base at around $0.1382 for TRX/USD over a 4-hour chart.

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Source: Tradingview.com

Besides the possible price actions ahead, the first resistance is set at $0.1400, while a stronger one is at $0.1420. On the positive side, TRX could aim for $0.1650 and $0.1720 upon a break-over of $0.1650, with an ultimate goal of $0.180 and above.

A downside correction may occur if TRX encounters resistance and fails to break above $0.140. Initial support levels include $0.1380 and the established trend line, followed by more substantial support at $0.1350 or the 50% Fibonacci retracement level. Failure to hold above these levels might lead to a test of $0.1320, with further declines possibly targeting $0.1250 in upcoming trading sessions.

Circle & Celo Forge Alliance: USDC Set To Elevate Financial Access Globally

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To foster widespread adoption of digital currencies, the Celo Foundation has revealed that Circle, a prominent player in the crypto space, will launch its USDC stablecoin natively on the Celo blockchain. This partnership aims to fortify Celo’s position as a carbon-negative, mobile-first, and EVM-compatible blockchain tailored for real-world applications.

USDC, a regulated digital dollar recognized for its stability and accessibility worldwide, will further amplify its utility by being minted directly on the Celo blockchain. This integration is expected to facilitate seamless conversions of USDC into fiat currencies, aligning with Circle’s mission to enhance global economic prosperity through frictionless value exchange.

Aligning Circle’s Prosperity Goals with Celo’s Vision

According to the blog post, the collaboration between Circle and Celo reflects a shared vision to leverage blockchain technology for a more inclusive, open, and equitable financial future. Celo’s thriving ecosystem, boasting the industry’s fastest-growing mobile decentralized applications and a global user base exceeding 1,000 projects across 150 countries, adds significant weight to the upcoming launch of USDC.

With a staggering market cap of $135.16 billion, stablecoins have emerged as dominant real-world assets, providing a gateway for broader financial access and inclusion. Celo already hosts diverse stablecoin use cases, including remittances, savings, lending, aid disbursement, and peer-to-peer transactions.

Isha Varshney, Head of Strategy and Innovation at the Celo Foundation, expressed enthusiasm about the partnership, stating:

We want to be the best ecosystem for stablecoins, which has proven to be among the industry’s prevailing use cases, as institutional investors come into Web3.

The integration of USDC into the Celo network is expected to unlock new possibilities for businesses and developers worldwide. This collaboration enables them to offer users fast, secure payments and a stable store of value through digital dollars. The availability of institutional on-/off-ramps like Circle Mint further enhances on-chain activity, allowing smooth conversions between USDC and local currencies.

As part of Celo’s commitment to user convenience, cLabs plans to propose a mechanism that enables users to pay network gas fees using USDC, enhancing the overall payment experience within the ecosystem.

Shamus Noonan, Senior Manager of Business Development at Circle, emphasized the collaboration’s crucial role in expanding USDC access and leveraging Celo’s mobile-first user base, especially in regions with growing blockchain adoption.

Related Reading | Mesh Crypto Startup Receives $6.5 Million From PayPal, Including $5 Million in PYUSD Stablecoins

LINK Up 15% Following Chainlink Integration With Circle’s CCTP

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Chainlink (LINK) has managed to maintain a steady price amidst a general market downturn, experiencing a notable 15% surge in the weekly chart. Despite other digital assets feeling the pressure, LINK reached $15.87 today, hovering just below last week’s peak at $16. This remarkable performance has propelled LINK to the forefront as one of the top-performing coins in the industry, boasting a nearly 30% increase from its lowest point this year.

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CoinMarketcap

Cross-Chain Innovation Propels Chainlink (LINK) Rise

The driving force behind this surge can be traced back to the official integration of Circle’s Cross-Chain Transfer Protocol (CCTP) with Chainlink’s Cross-Chain Interoperability Protocol (CCIP). This announcement has proven to be a game-changer for the industry, elevating LINK’s standing among cryptocurrencies.

The CCTP by Circle, the issuer of the widely adopted stablecoin $USDC, plays a crucial role in attesting to the burning of $USDC on a source chain through an off-chain API. In tandem, the CCIP by Chainlink securely relays these burn event attestations on-chain, triggering the minting of $USDC on a destination chain. 

The result is a seamless and secure cross-chain transfer of native $USDC, abstracting away backend complexities and ensuring reliable execution even in the face of destination chain gas spikes.

The integration is a significant unlock for developers, providing support for $USDC, one of decentralized finance’s (DeFi) most widely adopted stablecoins. CCTP introduces advantages like heightened security through the Risk Management Network, enhanced functionality via programmable token transfers, and more.

Chainlink expressed excitement about the integration in a press release. Sergey Nazarov, Co-Founder of Chainlink, highlighted the platform’s commitment to supporting the adoption of stablecoins across diverse cross-chain use cases. Nazarov emphasized the importance of CCIP’s advanced risk management features, especially in light of historical exploits and losses in user funds due to insecure cross-chain infrastructure.

With Chainlink’s proven track record of security and reliability, the integration of Circle’s CCTP is poised to open up new possibilities for developers, enabling the creation of secure and capital-efficient cross-chain applications. This move reinforces Chainlink’s position at the forefront of secure and reliable cross-chain interoperability in the blockchain industry.

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Circle CEO Predicts U.S. Legislation Targeting Stablecoins In 2024

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In the latest interview at the World Economic Forum in Davos, Circle CEO Jeremy Allaire expressed confidence that the United States is poised to enact specific legislation targeting the stablecoin market this year. Allaire’s optimism stems from a shared will among key entities, including the U.S. government, the Treasury Department, the Federal Reserve System, and both houses of Congress.

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Circle’s Confidence

The stablecoin market, valued at $135.3 billion, currently operates with limited regulations, unlike other jurisdictions worldwide that are embracing crypto-focused legislation. Allaire hopes for a shift in the U.S. landscape this year, anticipating the approval of laws governing stablecoin issuers, including Circle, the company behind the popular USD Coin.

Speaking with CNBC, Allaire emphasized the increasing momentum in regulatory developments globally within the crypto industry. He believes there is a strong desire within the U.S. administration, the Treasury, the Federal Reserve, and both chambers of Congress to pass stablecoin legislation.

Highlighting the urgency, Allaire noted that other countries are advancing regulations for digital dollars, leaving the U.S. lagging. He stated:

I think there is a very strong desire to act and assert U.S. leadership and get the right consumer protections involved.

Allaire addressed the Clarity for Payment Stablecoins Act, which is currently under consideration in the House of Representatives. The Act aims to subject stablecoins to the same regulatory frameworks as traditional financial services companies.

Circle, the company behind USD Coin, recently filed a confidential S-1 registration with the U.S. Securities and Exchange Commission (SEC), indicating its intention to go public. Allaire did not disclose details about the timing of the IPO but denied any correlation with the SEC’s approval of the first U.S. spot bitcoin ETFs.

Despite the regulatory uncertainty, Circle remains optimistic about the potential of stablecoins in 2024, citing the approval of a spot ETF and anticipated regulatory clarity worldwide.

Circle’s Chief Strategy Officer and Global Head of Public Policy, Dante Disparte, echoed Allaire’s optimism, stating that 2024 could see the introduction of stablecoin regulations in the U.S. Disparte emphasized the legitimacy of stablecoins for everyday purchases and trade, contrasting them with more volatile cryptocurrencies associated with illicit activities.

Nevertheless, industry insiders, including Circle executives, remain hopeful for a regulatory breakthrough in 2024, marking a significant milestone for the stablecoin market and the broader crypto industry.

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Tether’s Dominance Grows Amid Concerns of Expanding Use In Money Laundering

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Tether, the issuer of the USDT stablecoin, has witnessed a substantial increase in its share of the global stablecoin supply, surging from 50% to 71% throughout 2023, as reported by The Block. The company recently achieved a significant milestone by exceeding 95 billion stablecoins in circulation, surpassing the GDPs of nations like Guatemala and Bulgaria combined. In contrast, its primary competitor, Circle’s USD Coin (USDC), lags with a circulation of 27 billion tokens, down from 48 billion at the beginning of the year.

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UN Warns Of Tether’s Dark Side

However, amidst Tether’s success, recent reports indicate that the cryptocurrency platform has become a preferred tool for money launderers and fraudsters in Southeast Asia, according to a warning from the United Nations. The UN’s Office on Drugs and Crime released a report revealing that Tether’s crypto token is at the epicenter of a burgeoning industry of scams, including tactics such as the “pig butchering” strategy, where criminals engineer false romantic connections to exploit victims.

Jeremy Douglas of the UN’s Office on Drugs and Crime expressed concern about the rise of a parallel banking system facilitated by organized crime through new technologies, particularly within the loosely regulated online casino sector in Southeast Asia. The report emphasized the symbiotic relationship between online gambling platforms, illegal ones in particular, and Tether-based money laundering.

Despite the company being a stablecoin pegged to the US dollar, providing stability in cryptocurrency trading, the UN report reveals that authorities have uncovered various money laundering networks dealing in illicit Tether funds. Singaporean authorities dismantled an operation last August, recovering $737 million in cash and crypto.

Erin West, a criminal prosecutor and cybercrime expert, explained that Tether’s appeal to criminals lies in its promise of fast, irreversible transactions on the blockchain. West highlighted the challenges victims face, blinded by love and enticed by the prospect of quick wealth through unfamiliar cryptocurrency investments.

While there has been a broader crackdown on digital assets in the US and other regions, the company continues to be embraced by criminal groups for moving funds due to the perceived lack of effective cryptocurrency regulations. Tether’s token has become so ingrained in illicit activities that some casinos now specialize in handling it, further exacerbating concerns about the growing role of Tether in facilitating criminal transactions.

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Circle’s Secret IPO: Analysts Bullish On $1.5B 2023 Revenue

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USDC issuer Circle has confidentially filed for an initial public offering [IPO] with the intention of transitioning into a publicly traded company in the United States by early 2024. The specifics of the IPO, such as the number of shares to be offered and the proposed price range, remain undisclosed at this stage. The successful completion of the IPO is contingent on the review by the Securities and Exchange Commission [SEC] and prevailing market conditions.

As the issuer of the second-largest stablecoin globally and the seventh-largest cryptocurrency overall, according to CoinGecko, Circle’s tokens are collateralized by cash and cash equivalents, including short-term Treasury bonds.

The firm’s decision to pursue a public listing comes amidst a lengthy period of reduced deal-making activities amid elevated interest rates and market volatility. Other companies, such as Apex Fintech and Aspen Insurance, have also confidentially filed for US IPOs, signaling a potential revival in the public offering space.

This marks Circle’s third attempt at going public, with the previous attempts in 2022 through a special-purpose acquisition company [SPAC] and in 2021 with a special-purpose acquisition company named Concord Acquisition Corp. facing obstacles and ultimately being terminated. Despite the uncertainties surrounding the valuation sought in this IPO, Circle’s move aligns with its longstanding objective of becoming a publicly traded entity in the United States.

Circle’s Pursuit: Embracing Transparency

CEO Jeremy Allaire has consistently emphasized the significance of the IPO in enhancing trust and transparency for the company, which boasts major financial players such as Goldman Sachs, Fidelity, and Blackrock among its investors. While there have been rumors about Circle’s wavering commitment to an IPO, a spokesperson for the company has refuted such claims, asserting the unwavering pursuit of this strategic move.

Circle
Source: Ryan Selkis

Market analysts, including Messari’s Ryan Selkis, have noted the confidentiality of Circle’s IPO filing but highlighted the company’s strong performance, citing estimated revenues of $800 million in 2022 and a projection of approximately $1.5 billion in revenues and $300 million in profits for 2023. Circle’s decision to go public aligns with a broader trend among crypto companies seeking public status as a means to rebuild trust in the aftermath of the market challenges experienced in 2022.

Charting Crypto’s Transformative Trajectory: 5 Key Highlights From 2023

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2023 emerged as a pivotal year in the dynamic landscape of the crypto industry, marking a shift from the turbulence of 2022. Five key charts shed light on the transformative journey of cryptocurrencies over the past year, according to the recent report from the Block.

Crypto Chart Chronicles Of 2023

Firstly, the Grayscale Bitcoin Trust (GBTC) witnessed a remarkable narrowing of its discount to Net Asset Value (NAV). Following Grayscale Investments’ triumph against the SEC in August, the GBTC discount dropped below 10% for the first time since July 2021. This trend, a significant departure from the historic premium, reflects growing optimism regarding the potential approval of a spot bitcoin ETF in the U.S.

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Contrastingly, Binance faced a challenging year as its legal and regulatory troubles unfolded. In November, the U.S. authorities settled a criminal investigation with Binance, resulting in a historic $4.3 billion penalty. Former CEO Changpeng Zhao’s guilty plea and subsequent resignation further compounded the exchange’s woes. Binance’s market share among non-USD exchanges dwindled from over 70% to around 46% by the year’s end, signaling a significant setback.

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Meanwhile, the stablecoin USDC, issued by Circle, experienced a squeeze in its market share. Starting the year with a 32% share, USDC faced a depegging from the U.S. dollar in March, leading to a 15% drop in its market cap within 24 hours. The subsequent months witnessed a continued erosion of USDC’s market share, falling to 19% by the end of the year, with USDT strengthening its dominance.

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Bitcoin, traditionally not associated with NFTs, played a crucial role in the resurgence of the NFT sector. The Bitcoin Ordinals protocol, introduced in January 2023, allowed users to engrave NFTs directly onto the blockchain, leading to a transaction surge. Bitcoin-based NFTs accounted for around 59% of the peak weekly NFT trading volume, revitalizing the NFT market.

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Closing the year on a positive note, the crypto market rebounded from the challenges of 2022. Bitcoin’s value surged by 160%, while Ether witnessed a 94% increase from its position a year ago. Solana emerged as the top performer among the top ten cryptocurrencies, experiencing a staggering 1,000% gain.

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However, the industry continues to evolve, promising more developments in the year ahead as the crypto community anticipates the potential approval of a spot Bitcoin ETF and the upcoming Bitcoin halving event in 2024.

Related Reading | XRP’s Trader Foresees Potential Dip Before Anticipated Surge

Circle Charts Regulatory Milestone In France, Taps Payment Industry Expert for Key Role

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Global financial technology firm Circle, renowned for issuing stablecoins such as USDC and EURC, revealed in a press release on December 21st that it has received conditional registration as a Digital Asset Service Provider (DASP) with the French Financial Markets Authority (AMF).

The announcement underscores the company’s commitment to France and the European Union, with the firm also disclosing the appointment of Coralie Billmann, a seasoned professional in the payments industry, to lead its licensed operations in the country. However, Billmann’s role is contingent upon regulatory approval.

To initiate operations in France, Circle must fulfill the conditions tied to its registration by obtaining approval as a payment services provider (PSP) or registration as an agent of a PSP. The company is currently in the process of obtaining an Electronic Money Institution license to satisfy this requirement.

Billmann brings a wealth of experience to her role at Circle, having played a pivotal role in launching the payments activity of 3S Money Club in Europe and serving in leadership positions at JP Morgan and PayPal. Her strong background in compliance and finance positions her to play a crucial role in ensuring MiCA readiness and passportability for Circle’s products and services.

Jeremy Allaire, Co-founder, CEO, and Chairman at Circle, emphasized the company’s commitment to a regulatory-first approach, citing the conditional DASP registration in France as a significant milestone. He praised Billmann’s expertise:

With Coralie Billmann joining Circle, her deep market expertise and leadership will be instrumental in furthering our regulatory efforts and deepening our connections in France.”

Circle’s Regulatory Vision

Circle aims to bring its European operations under comprehensive EU oversight by securing both a full DASP and Electronic Money Institution license. This aligns with the stringent standards the Autorité de Contrôle Prudentiel et de Résolution (ACPR) set and ensures compliance with the forthcoming Markets in Crypto-Assets (MiCA) regime.

Dante Disparte, Circle’s Chief Strategy Officer and Head of Global Policy highlighted the strategic selection of France as their European regulatory base, citing the country’s clear rules for responsible innovation in fintech and digital assets.

Meanwhile, Coinbase, a major player in the crypto space, has also secured authorization from the AMF as a Virtual Assets Service Provider (VASP). This move positions Coinbase to custody digital assets and offer and facilitate crypto trading in France, aligning with EU and international regulations. Additionally, Coinbase has expanded its services to institutional foreign investors outside the United States, enabling them to trade Bitcoin and Ether against USD Coin.

Related Reading | 69k Bitcoins Seized In Silk Road Face U.S. Judgment

Circle Denies Funding Hamas Or Banking Justin Sun In Open Letter To Senators

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Circle, the company behind the popular USDC stablecoin, has strongly denied recent accusations that it is tied to terrorist financing or controversial crypto figure Justin Sun. In a letter addressed to U.S. Senators Sherrod Brown and Elizabeth Warren, Circle’s Chief Strategy Officer Dante Disparte dismissed these claims as “false” and intended to damage Circle’s reputation.

Disparte responded to a letter sent to the Senators in November 2023 by the Campaign for Accountability (CfA). The CfA letter alleged that the company has close relationships with Sun and his Tron blockchain platform, which supposedly funded groups like Hamas, Hezbollah, and the Palestinian Islamic Jihad. It also said USDC was among $93 million worth of crypto assets seized by Israel from wallets linked to these terrorist organizations.

Circle Highlights Regulatory Compliance and Cooperation

In his letter, Disparte pointed out that the company cooperates extensively with regulators and law enforcement agencies to combat illicit finance. This includes the Treasury Department’s Office of Foreign Assets Control (OFAC), the Financial Crimes Enforcement Network (FinCEN), and the New York Department of Financial Services (NYDFS).

Disparte also admitted that Circle previously had dealings with Sun but stated this was done legally and Sun is not on the government’s Specially Designated Nationals (SDNs) list. The company has since terminated its relationship with Sun and no longer provides services to him, Tron, or any affiliates.

Denies Involvement In Terrorist Financing

Additionally, Disparte denied that USDC was used by terrorist groups, referring to public blockchain records showing only $160 worth of USDC transfers among the Israel-identified wallets. He stressed that none of those funds originated from Circle and that the company can freeze or revoke tokens it deems illicit.

Disparte closed by expressing Circle’s willingness to work with policymakers on crypto industry regulations. He invited the Senators to meet and discuss these issues while highlighting Circle’s commitment to protecting consumers, investors, and national security.

The strongly worded letter signals that the company is eager to defend itself and USDC against accusations of lax anti-money laundering controls or ties to prohibited entities. However, it remains to be seen whether regulators will open an investigation into Circle and other stablecoin operators in response to the allegations raised.

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