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Binance Rejects Justin Sun's Offer for Huobi Stake, Citing Suspected Chinese Connections – Here's What Happened

Image Source: CNBC

Binance has reportedly rejected an offer by crypto entrepreneur Justin Sun to purchase his stake in cryptocurrency exchange Huobi, citing ties to mainland China.

The world's largest cryptocurrency exchange turned down the alleged proposal due to rumors surrounding Huobi’s relationships with China, which used to be the platform's main market, CoinDesk reported, citing a person familiar with the matter. 

In a recent tweet, Sun dismissed the rumors, claiming that he has not made any proposal to Binance CEO Changpeng Zhao regarding the purchase of Huobi "in the past week or so."

Over the weekend, a Bloomberg report claimed that Sun had held talks about selling his stake in Huobi Global, citing a person with direct knowledge of the matter. 

The report further claimed Sun had contacted some potential investors over the past weeks.  

Sun also denied those claims, claiming that he has no intentions to divest his stake in the global cryptocurrency exchange Huobi. 

It is worth noting that Sun’s involvement with Huobi has been cloaked in mystery.

In December last year, Huobi founder and controlling shareholder Leon Li Lin announced that he was selling his entire stake in the Seychelles-based crypto exchange to About Capital Management, a Hong Kong-based assets management company.

Sun, who reportedly spearheads the management firm, confirmed back then that he would be joining the Global Advisory Board of Huobi Global.

However, China-based journalist Colin Wu claimed that Justin Sun was the core investor in About Capital, suggesting that he was the real buyer of the stake (which the report estimated to be around $1 billion). 

"WuBlockchain learned from multiple sources that Justin Sun is actually the core investor of this M&A fund," the report said, adding that the Tron founder was at the delivery site in Singapore on October 8 where the deal took place. 

Sun Faces Tumulous Times Amid SEC Lawsuit

The US Securities and Exchange Commission has recently unveiled fraud and unregistered securities charges against Sun and three of his wholly-owned companies, Tron Foundation Limited, BitTorrent Foundation Ltd., and Rainberry Inc, for the sale of their TRX and BTT tokens. 

The SEC alleged that Sun and the companies paid celebrities with vast social media followings to hype TRX and BTT and directed them not to publicly disclose their compensation.

This came as Sun has seen numerous tokens he’s purchased or endorsed either collapse or not perform as designed, from Huobi's native token (HT) to TUSD, USDD, and USDJ. 

The USDD and USDJ stablecoins remain off their intended price points while the True Token network no longer has a known auditor.

In another blow to the crypto boss, local Grenadian media has reported that Sun lost his ambassador status and title ‘His Excellency’ during the summer of 2022, despite keeping up the pretense on social media in the months following.