Justin Sun, behind TRON (TRX), one of the largest Blockchain networks, attracted attention with a coin transfer of $ 6.1 million. Sun withdrew its funds from a lending protocol that appeared to be related to FTX. Sun has been particularly prominent lately for its potential to bail out the now bankrupt crypto exchange FTX. Here are the details…
TRON founder withdraws assets from TrueFi
Justin Sun, founder of the Tron (TRX) network and potential savior of the now bankrupt crypto exchange FTX, has moved the $6.1 million stablecoin from decentralized lending protocol TrueFi. TrueFi is among the companies heavily indebted to FTX’s sister company, Alameda Research. Blockchain transaction data shows that Sun withdrew funds in four transactions on Thursday. It moved $2.4 million USDT, $2.1 million USDC, $1 million TUSD and $673,000 BUSD from four existing loan pools in the lending protocol.
The crypto wallet has been identified as Sun-owned by crypto intelligence platforms Arkham Intelligence and Nansen. TrueFi allows liquidity providers to lend money in exchange for a return. It is also a decentralized lending protocol where borrowers can also borrow against interest. Loans are unsecured, meaning creditors do not pledge their assets against their transactions. Borrowers secure the loan only by their good financial standing.
Alameda owes TrueFi
The withdrawals came after the sudden collapse of a trading firm, FTX and Alameda Research. This can be seen as another sign of an ongoing liquidity squeeze in the crypto credit markets. Alameda Research’s TrueFi has $7.3 million in outstanding debt at its Capital Markets credit facility managed by TrueTrading. According to TrueFi’s dashboard, Alameda’s debt represents almost half of all outstanding loans under the protocol.
As we reported as Kriptokoin.com, Alameda filed for bankruptcy protection on Friday. Therefore, according to many, the chances of being able to repay the loan are low. The founder of TRON also seems to have preferred to be prepared in the face of any trouble.
TrueFi has already been shaken by the last two loan defaults. South Korea-based Blockwater has defaulted on $3 million in debt despite restructuring efforts. Then, Invictus Capital filed for court-sponsored liquidation earlier this year. Afterwards, it failed to repay the $1 million loan by the due date. According to the decentralized financial data site DefiLlama, the total value locked in TrueFi has declined. It has dropped from $544 million to $32 million in the last six months as the appetite for crypto borrowing wanes.
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