Our weekly roundup of news from East Asia curates the industry’s most important developments.
Chinese crypto billionaire sued by SEC
On Mar. 22, the U.S. Securities and Exchange Commission, or SEC, announced charges against Chinese blockchain personality and billionaire Sun Yuchen — better known as Justin Sun — and three of his wholly-owned companies Tron Foundation Limited, BitTorrent Foundation Ltd., and Rainberry Inc. (formerly known as BitTorrent).
The complaint alleges that Sun and his companies “fraudulently” manipulated the secondary market for Tron (TRX) tokens through “extensive wash trading”, citing more than 600,000 such trades, and paying celebrities to promote TRX and BitTorrent (BTT) tokens with zero disclosure.
Multiple prominent American celebrities, such as Lindsay Lohan and Jake Paul, were named as defendants in their alleged roles in promoting TRX and BTT without proper disclosure. Some have since settled with the SEC. In addition, the SEC alleges that bounty programs and airdrops used to promote TRX and BTT were unregistered investments. Gary Gensler, chairman of the SEC, commented:
“As alleged, Sun and his companies not only targeted U.S. investors in their unregistered offers and sales, generating millions in illegal proceeds at the expense of investors, but they also coordinated wash trading on an unregistered trading platform to create the misleading appearance of active trading in TRX.”
Justin Sun is an active figure in the crypto industry who rose to prominence via the $70 million initial coin offering (ICO) of Tron in 2017. The ICO was reportedly conducted one day prior to the Chinese government’s announcement of a blanket ban on all ICOs within the country. Sun, who allegedly left Beijing shortly after and moved to San Francisco, used his newfound wealth from the successful Tron ICO to acquire the peer-to-peer downloading platform BitTorrent.
Sunreportedlylaid low while in the U.S. and presented himself as an honest businessman fleeing from the spectres of communism. U.S. authorities have heard this sort of rhetoric before however and on Mar. 15, the U.S. Department of Justice announced that it had arrested Chinese billionaire Guo Wengui over his role in an alleged $1 billion stock and crypto fraud scheme. Just days before his arrest, Guoshilled to his viewersthe importance of his crypto exchange, blockchain technology, and tokens he had created in the fight against communism.
The interest from U.S. authorities may have been behind Sun’s decision to move out of the U.S. in 2020 into the sunny Caribbean island of Grenada. He has since become the country’s ambassador to the World Trade Organization. Aside from foreign relations duties and the bestowment of the fancy title “His Excellency,” the role grants Sun a diplomatic passport that theoretically provides immunity against prosecution.
Despite the controversies, Sun appears to be doing quite well in his new home. Last November, Sun reportedly acquired 100% of co-founders’ stakes in cryptocurrency exchange Huobi Global even though he publicly claims he is just a humble “advisor” in Huobi’s everyday affairs.
In January, Asia Express reported that many Huobi employees’ benefits were allegedly axed via direct orders from Sun. In other areas, cryptocurrency exchange Binance has also significantly limited its utilization of Tron Tether (TRC-20 USDT) after regulatory backlash on its own stablecoin Binance USD.
Do Kwon’s bad bet at Casino Royale
If Do Kwon has anything in common with James Bond in the 2006 hit filmCasino Royale, it is that both found (or is currently finding) their stay in the beautiful seaside nation of Montenegro to be deeply unpleasant. On Mar. 23, Filip Adzic, Minister of the Interior of Montenegro, announced that a South Korean national suspected of being the wanted fugitive Terraform Labs co-founder Do Kwon had been arrested at Podgorica Airport over falsified documents.
Shortly after the announcement, South Korean authorities confirmed that the detained individual is, in fact, Do Kwon based on a positive match of name, birth date, nationality, and photographic evidence. Police say they are awaiting a fingerprint check from Montenegrin authorities to definitively identify the arrested individual.
Do Kwon is currently wanted by Interpol, as well as South Korean, Singaporean, and U.S….
cointelegraph.com