Tron’s Justin Sun Mulls Over Making A Move On FTX’s Crypto Stash, Here’s Why

Scott Matherson

1 year ago

3 mins read

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In a completely unexpected move, Justin Sun, Founder of Tron and Advisor to Huobi Global has expressed his interest in acquiring FTX’s considerable crypto assets worth billions of dollars.

Justin Sun Considers Making A Bid For FTX Crypto Assets

Justin Sun, Creator of Tron, one of the world’s largest blockchain ecosystems, has hinted at the possibility of acquiring the assets of insolvent crypto exchange FTX. This statement comes a year after the crypto billionaire was contemplating a majority takeover of Huobi Global.

According to data from Messari, a provider of market intelligence products, FTX liquidations hold a total of $1.3 billion in liquid crypto assets excluding stablecoins. The report revealed some of the largest holdings for FTX liquidators which include cryptocurrencies like Solana (SOL), Ethereum (ETH), Aptos (APT), Dogecoin (DOGE), Tron (TRX), and Polygon (MATIC).

Given the considerable holdings, there have been fears that the market could witness a crash if the exchange were to start dumping its crypto assets. In response to this, Sun revealed in a post on X (formerly known as Twitter) that he was considering the possibility of purchasing FTX holdings.

The Tron Founder explained that the reason behind it was to reduce their selling influence on the crypto market.

“Contemplating an offer for FTX’s holding tokens and assets to reduce their selling impact on the crypto community. Let’s unite to bolster our crypto ecosystem,” Sun stated.

However, data from Messari revealed that FTX and Alameda’s BTC holdings, which are approximately $353 million, account for only 1% of BTC’s weekly trading volume, meaning the crypto market can easily handle selling impacts.

Whereas, FTX’s crypto holdings such as DOGE, TRX, and MATIC which range from $20 million to $30 million account for 6-12% of weekly trading volumes, and liquidations could significantly impact the crypto market.

Most of FTX’s SOL are also locked up in Alameda and FTX ventures, and they have a unique liquidation pattern, which allows only $9.2 million SOL to be unlocked every month. This monthly liquidation system allows selling impacts of FTX’s Solana holdings to be easily managed.

FTT price steadies above $1 | Source: FTTBUSD on Tradingview.com

FTX Insolvency Court Case Still Ongoing

On November 11, 2022, FTX and a number of its affiliates filed for bankruptcy in Delaware, United States. At the time, the exchange owed a staggering $8 billion after it collapsed due to a liquidity crisis.

The crypto exchange is currently under investigation by the United States Securities and Exchange Commission (SEC) while its Founder and CEO, Sam Bankman Fried was charged on 13 accounts for alleged illegal proceedings he performed in FTX, five of which were later withdrawn in June.

FTX liquidators are currently scheduled for a hearing on Wednesday, September 13. The result of the hearing may see the liquidators given clearance to begin liquidations immediately.

A recent court filing has also revealed that the bankrupt crypto exchange still holds assets worth $7 billion. Some of these assets include digital assets, venture investments, and reclaimed properties.

Featured image from Watcher Guru, chart from Tradingview.com

Scott Matherson

Scott Matherson is a prominent crypto writer at NewsBTC with a knack for capturing the pulse of the market, covering pivotal shifts, technological advancements, and regulatory changes with precision. Having witnessed the evolving landscape of the crypto world firsthand, Scott is able to dissect complex crypto topics and present them in an accessible and engaging manner. Scott's dedication to clarity and accuracy has made him an indispensable asset, helping to demystify the complex world of cryptocurrency for countless readers.

Scott’s experience spans a number of industries outside of crypto including banking and investment. He has brought his vast experience from these industries into crypto, which allows him to understand even the most complex topics and break them down in a way that is easy for readers from all works of life to understand. Scott’s pieces have helped to break down cryptocurrency processes and how they work, as well as the underlying groundbreaking technology that makes them so important to everyday life.

With years of experience in the crypto market, Scott began to focus on his true passion: writing. During this time, Scott has been able to author countless influential pieces that have drawn in millions of readers and have shaped public opinion across various important topics. His repertoire spans hundreds of articles on various sectors in the crypto industry, including decentralized finance (DeFi), decentralized exchanges (DEXes), Staking, Liquid Staking, emerging technologies, and non-fungible tokens (NFTs), among others.

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