Circle Formally Refutes Allegations of Illicit Financing and Connections to Justin Sun

Circle, a leading issuer of stablecoins, has recently addressed and strongly refuted allegations regarding its involvement in illicit financing and alleged connections with Justin Sun, the founder of Tron. These claims, brought forward by the nonprofit watchdog organization, Campaign for Accountability (CfA), prompted Circle’s Chief Strategy Officer and Head of Public Policy, Dante Disparte, to write a formal response to U.S. Senators Elizabeth Warren and Sherrod Brown.

In the letter, Disparte emphatically denies any involvement of Circle in facilitating or financing activities related to Hamas or any other illicit actors. He highlights Circle’s unwavering commitment to combating illicit financial activities. Circle has been an active partner with regulators and law enforcement in the United States, Israel, and other jurisdictions, ensuring that their stablecoin, USDC, is not used for illicit activities. The company’s dedication to legal compliance was recently acknowledged by the U.S. Secret Service, recognizing Circle’s efforts in identifying fraud and assisting in fund recovery.

Addressing specific allegations, Disparte referred to an incident where the National Bureau for Counter Terror Financing of Israel identified digital wallets linked to the Palestinian Islamic Jihad (PIJ) with assets amounting to $93 million. A report by the blockchain firm Elliptic initially suggested that all assets in these wallets were used to finance PIJ, but this was later corrected. Public blockchain ledgers revealed that of the $93 million, only $160 in USDC was transferred among those wallets, and none of that amount originated from Circle. This example underscores Circle’s stance against the misrepresentation of its role in alleged illicit activities.

Furthermore, Circle clarified its relationship with Justin Sun, stating that it does not provide banking services to him or his associated entities, including the TRON Foundation or Huobi Global. Despite the absence of specific designations by the U.S. government, Circle terminated all accounts associated with Mr. Sun and his affiliated companies in February 2023.

Circle also emphasized its status as a highly regulated financial entity. It operates under the regulatory frameworks of multiple U.S. states and federal bodies, including the Ohio Department of Commerce Division of Financial Institutions and the New York Department of Financial Services. As a Money Services Business registered with FinCEN, Circle adheres to the Bank Secrecy Act, anti-money laundering laws, and other regulatory standards. This regulatory compliance is a cornerstone of Circle’s operations, reflecting its commitment to legal and ethical business practices.

In its advocacy for regulatory reforms, Circle has been a vocal proponent for a comprehensive federal framework governing stablecoins. The firm has actively participated in legislative processes, seeking to establish robust reserving, redemption, disclosure, liquidity, and operational risk management standards for stablecoin issuers. Circle’s CEO, Jeremy Allaire, has testified before Congress, advocating for standards that would elevate the safety and reliability of stablecoin issuers.

Circle’s response to the allegations made by the CfA is a strong affirmation of its dedication to regulatory compliance and ethical practices in the digital assets space. The company remains committed to collaborating with regulatory bodies to enhance the regulation of digital asset markets and to combat money laundering and terrorism financing effectively.

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Huobi HTX Responds to Recent Hack, Ensures Full Compensation for Affected Users

On November 22nd, 2023, Huobi HTX, previously known as Huobi Global, experienced a significant security breach. This attack led to a substantial loss, initially estimated at $13.6 million but later valued at approximately $30 million. This incident marks another in a series of cybersecurity challenges faced by cryptocurrency exchanges and related platforms.

Following the attack, Huobi HTX issued a statement to its users, reassuring them about the security of their funds. The exchange committed to fully compensating the losses incurred due to the attack, emphasizing its dedication to user fund safety. Despite the substantial loss, HTX clarified that the incident had a minimal impact on the platform’s overall financial health and would not affect its normal operations.

Huobi HTX announced plans to resume deposit and withdrawal services within 24 hours of the incident. In line with its commitment to security, HTX highlighted the importance of protecting user assets and information. The exchange assured the implementation of all necessary measures to prevent such incidents in the future.

This incident is part of a larger pattern of security breaches affecting platforms associated with or managed by Chinese entrepreneur Justin Sun. Notably, the HTX Eco (HECO) Chain bridge, involving HTX, Tron, and BitTorrent cryptocurrency, suffered an $86.6 million loss in a separate attack. In total, HTX and other Sun-related businesses have faced four distinct hacks in the past two months, raising concerns about the robustness of their security measures.

The most notable recent attack was against the Poloniex exchange on November 10th, resulting from an alleged private key breach. This incident led to a loss of $100 million, prompting an ongoing investigation to identify the root cause. A $10 million white hat reward is currently offered for the return of the funds stolen in the Poloniex exploit.

Justin Sun has publicly addressed these incidents, emphasizing ongoing investigations to understand the reasons behind these hacks. He reassured that services would resume once the investigations are complete and the vulnerabilities are addressed.

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HTX Hacker Returns Stolen Ether, Rewarded with Bounty

Huobi Global’s cryptocurrency exchange HTX encountered a significant security breach on September 25, when one of its hot wallets was compromised and drained of 5,000 Ether (ETH), which was valued at approximately $8 million at the time. This incident was part of a broader trend of increasing security breaches within the cryptocurrency and Web3 spaces during the third quarter of 2023. However, the narrative took a positive turn on October 7, when the hacker returned the stolen funds. Following this action, HTX issued a 250 ETH whitehat bounty to the individual, which, with an exchange rate of $1,621 per ETH, is valued at around $410,000.

The Bounty Offer

In the aftermath of the hack, HTX promptly initiated communication with the hacker. The exchange claimed to be aware of the individual’s identity and proceeded to offer a 5% bounty of the stolen funds, which equates to around $400,000, under the condition that 95% of the stolen funds were returned before a set deadline of October 2. Additionally, it was agreed that HTX would abstain from pursuing any legal action against the hacker if the stipulated conditions were met, thus providing an incentive for the hacker to return the stolen assets.

The return of the stolen funds and the subsequent bounty reward were publicly acknowledged by Justin Sun, Huobi Global owner, on October 7 through a post on X (formerly Twitter). Sun expressed that “The hacker made the right choice. We would like to express our gratitude to everyone in the industry for their help!” He also underlined the persistent endeavor to bolster blockchain security and ensure the protection of user assets, a task that he described as never easy but crucial for the industry. His acknowledgment was echoed across the community, emphasizing the collaborative nature of blockchain security endeavors and the importance of community support in overcoming such security challenges.

The incident with HTX is a part of a larger hacking landscape that has seen a significant uptick in the third quarter of 2023. A recent report from blockchain security platform Immunefi highlighted a sharp rise in the number of hacking incidents, with 76 reported hacks in Q3 2023 as compared to 30 in Q3 2022. The same week HTX was targeted, another notable project, the decentralized cross-chain protocol Mixin Network, also suffered a security breach. Attackers exploited a vulnerability associated with a third-party cloud service provider and managed to siphon off around $200 million. These incidents underscore the pressing need for enhanced security measures within the rapidly evolving crypto and Web3 spaces, and the HTX incident serves as a unique case of community and hacker collaboration towards a resolution.

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CoinDesk Under Fire for Retracting Articles on Justin Sun and Chainalysis

Leading cryptocurrency news source CoinDesk has lately come under criticism for removing stories that criticised specific players in the industry. The retractions have called into doubt the platform’s commitment to balanced reporting and editorial integrity.

L0la L33tz, a Twitter user, disclosed that CoinDesk had withdrawn an opinion piece she had published regarding Chainalysis on August 28, 2023. The centrepiece of the report was a witness statement made by Chainalysis‘ head of investigations, Elizabeth Bisbee, “in which she admitted to having no scientific evidence of the software’s accuracy.” Along with failing to notify L0la L33tz of the retraction, CoinDesk allegedly failed to disclose that its parent firm, DCG, had a “substantial investment in Chainalysis Inc.” “Today I discovered that @CoinDesk removed my opinion piece on @chainalysis… CoinDesk did not notify me of the retraction or reveal the sizeable interest its parent firm, DCG, has in Chainalysis Inc.

On August 27, 2023, a different Twitter user named Cryptadamist brought attention to the fact that CoinDesk has also since removed a Justin Sun-critical piece because it did not adhere to their “standards.” Coindesk recently withdrew an article that was critical of Justin Sun because it didn’t adhere to their “standards,” contrary to what they claim they almost never do.

These occurrences have sparked a discussion regarding the function of the media in the bitcoin sector. The retractions, according to critics, undermine CoinDesk’s reputation and imply a lack of openness. Speculation regarding the impact of outside influences, such as investments or partnerships, on CoinDesk’s editorial choices is further fueled by the company’s failure to provide a public retraction statement or explanation.

The incident highlights the more general problem of journalistic ethics in the high-stakes, quick-paced world of cryptocurrency reporting. The need for objective, truthful reporting is more urgent as the sector expands. For investors, regulators, and the general public, media sources are a crucial source of information. Any apparent bias or lack of transparency may have significant effects, not just on the media outlet’s reputation but also on the amount of public confidence in bitcoin journalism as a whole.

Due to CoinDesk’s recent activities, some have begun to wonder whether the platform can be relied upon to “act in favour of the people, putting factual reporting over shareholder incentives,” as L0la L33tz noted. The retractions highlight the need of preserving editorial independence and openness for other media entities covering the cryptocurrency field.

As of right now, CoinDesk hasn’t made any public remarks addressing the retractions or the bias claims. The instances serve as a reminder that media outlet integrity continues to be a subject of continuing worry and scrutiny in the quickly changing crypto scene.

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Involved in Cryptocurrency and Cash Corruption, Regional Military Recruitment Heads Were Dismissed by Ukrainian President

Ukrainian President Volodymyr Zelensky has directed Valeriy Zaluzhny to dismiss all heads of regional territorial centers for recruitment and social support. The decision was announced on the official Facebook page of the President’s Office of Ukraine.

During a meeting of the National Security and Defense Council of Ukraine on August 11, the issue of inspecting territorial centers for recruitment and social support was discussed. The council recommended that Commander-in-Chief Valeriy Zaluzhny appoint officers who have directly participated in combat actions to the positions of heads of regional centers, following a check by the Security Service of Ukraine (SBU).

The inspection of the centers revealed instances of corruption, particularly during general mobilization, posing a threat to national security and undermining trust in state institutions. Law enforcement officials have opened 112 criminal proceedings against military recruitment officials and announced 33 suspicions.

“Regional ‘military commissioners,’ city, district, medical commission workers, other officials. Abuses in various regions: Donetsk, Poltava, Vinnytsia, Odessa, Kyiv, Lviv. Some took cash, some – cryptocurrency. Our decisions are as follows. We dismiss all regional ‘military commissioners.’ This system must be managed by people who know exactly what war is. Warriors who have been through the front or who cannot be in the trenches because they have lost their health, lost their limbs, but have retained their dignity and have no cynicism – they can be trusted with this recruitment system. This decision must be implemented by Commander-in-Chief Zaluzhny. Before appointing new heads of the centers, the Security Service of Ukraine will check,” emphasized Zelensky.

In related news, law enforcement officers exposed a large-scale scheme for issuing military-medical commission certificates of unfitness for military service in the Lviv region and nine other regions of Ukraine earlier this month.

Additionally, in February 2022, Oleksandr Tishchenko, who was elected to the Lviv Regional Council from the “Servant of the People” party in the 2020 local elections, was appointed head of the Lviv Regional Territorial Center for Recruitment and Social Support.

The Ukrainian government has been active in soliciting donations, including those in cryptocurrency, since the start of the Russian invasion. On February 26, 2022, official Twitter accounts belonging to the Ukrainian government posted requests for donations in various crypto assets. They listed addresses for Bitcoin, Ethereum, TRON, Polkadot, Dogecoin, and Solana, inviting supporters to contribute to the cause.

Notable contributors from the crypto community include Polkadot founder Gavin Wood and Tron founder Justin Sun. The transparency and traceability of blockchain technology allow for public verification of these donations.

The Bitcoin donation address is: 357a3So9CbsNfBBgFYACGvxxS6tMaDoa1P

The Ethereum donation address is: 0x165CD37b4C644C2921454429E7F9358d18A45e14

As of the time of writing, the Bitcoin address has received a total of 648.19097723 BTC, of which 648.00967951 BTC has been used. 

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60k BTC and 60k ETH on Justin Sun’s Tron Seem Unbacked

Crypto analyst ErgoBTC has raised serious questions about the backing of TRC20 BTC tokens on the Tron network in a series of tweets. The analyst suggests that 60,000 of these tokens, currently parked in the JustLend protocol, appear to have never been backed. This implies an unbacked (non-existent) Total Value Locked (TVL) of $1.8 billion, which is roughly 50% of the current TVL in the JustLend protocol.

ErgoBTC’s tweets were in response to another tweet by a user named “alto | dollar.eth” who claimed to have found the wallet that backs the 60k ETH on Tron, but its current balance is zero. This raises further questions about the backing of TRC20 tokens on the Tron network.

In a typical centralized peg scheme, the custodian advertises their reserve holdings for transparency and trust, as seen with wBTC. However, information on the custodian for the TRC-20 BTC backing is practically non-existent.

The analyst conducted a thorough investigation into the existence of the total 114k BTC on the BTC blockchain. The findings suggest that if these coins exist, they are not sitting in a dedicated address. Furthermore, a deeper dive into the 60k “mint” done on August 21, 2022, revealed no signs of this activity on the BTC blockchain.

The investigation extended to major exchanges such as Poloniex, Huobi, and Binance, but none showed signs of the 60k BTC transactions. The TronDAO, which is not explicitly used for backing TRC20 BTC, also showed no signs of related non-exchange addresses.

The analyst concludes that these findings are signs that the TRC20 BTC on Tron was at best temporarily and partially unbacked, and at worst, still partially backed (-60k of the reported 114k BTC). The biggest impact seems to be a completely fake JustLend TVL, approximately 50% of which is apparently unbacked.

The tweets also trace the path of the 60k BTC minted on August 21, 2022, which was sent to JustLend for a 600m USDC loan. Half of this loan was repaid within two hours of creation, funded by an address attributed to Justin Sun. The remaining loan was funneled through another wallet, which also received from J-Sun and deposited over $1 billion to Circle in late September and early October.

The blockchain story ends here, but ErgoBTC notes that Huobi changed hands on OCT 10, 2022, one week after the >1B USDC deposits to Circle . The analyst emphasizes that the absence of evidence is not evidence of absence, but none of this would be necessary if the TRC20 BTC custodian was transparent.


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ZachXBT’s Defamation Lawsuit Receives Over $1 Million in Donations as Prominent Figures Rally Support

In a surprising turn of events, renowned on-chain analyst ZachXBT has exceeded his initial fundraising target, amassing a staggering $1,055,233 in donations, according to Nansen data. This remarkable achievement has been made possible through contributions from various entities and influential figures within the crypto industry.

Prominent supporters include Binance CEO Changpeng Zhao, Coinbase Cloud’s protocol lead Viktor Bunin, CertiK, Justin Sun, Kraken co-founder Jesse Powell, and Polygon’s founder Sandeep Nailwal.

Changpeng Zhao, in a tweet, expressed Binance’s commitment by pledging $50,000 to the cause, while urging ZachXBT to persevere in his fight and emphasizing the importance of transparency in the industry.

Jesse Powell also expressed gratitude for ZachXBT’s work and pledged a donation of 10 ETH.

Brown Rudnick partner Palley, along with Jess Meyers and the team at Brown Rudnick, expressed their honor in representing ZachXBT’s mission to speak truth to power.

Sandeep Nailwal, founder of Polygon, praised individuals like ZachXBT for their contributions and pledged 5 ETH to support the legal battle.

The lawsuit filed by Huang accuses ZachXBT of damaging his reputation through false allegations made in an article published by ZachXBT approximately a year ago. Huang vehemently denies the allegations and is determined to prove their falsity through the legal proceedings. In a recent tweet, Huang stated that he initially expected an apology and expressed his intention to donate any monetary compensation received to charity.

Huang Licheng(Jeffrey Huang),known as MachiBigBrother on Twitter, a former American-Taiwanese musician and technology entrepreneur, had been involved in a controversial incident in 2018 when he allegedly misappropriated 22,000 ETH from Formosa Financial. Furthermore, over the past four years following the collapse of Formosa Financial, Huang has been associated with a series of unsuccessful token launches and NFT projects.

In response to the lawsuit, ZachXBT expressed disappointment and asserted that the legal action taken against him is an attempt to stifle free speech. He remains resolute in his commitment to fight back and defend the principles of free expression.

To cover the legal expenses and protect the freedom of speech, ZachXBT has set up a donation wallet address for his followers and the wider community.This legal dispute has garnered significant attention within the industry, with key players showing their support for ZachXBT’s cause. The influx of donations and the rallying behind the principle of free speech highlight the crypto community’s dedication to transparency, accountability, and the pursuit of truth.


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Huobi Global Faces Mounting Challenges: Trademark Dispute, Legal Troubles, and Operations Suspension

Huobi Global, a prominent cryptocurrency exchange, is encountering significant challenges on multiple fronts, encompassing a trademark dispute, allegations of fraud against a key person, and an order to halt its operations in Malaysia.

Li Lin, the founder of Huobi, has openly disassociated himself from the firm’s operations since October 8, 2022. In a statement posted on his WeChat ‘Moments’, Li clarified that he is no longer a shareholder of Huobi (also referred to as ‘火必’ in Chinese) and has no connection with any of the company’s business activities post this date.

Further, he voiced his objection to Huobi’s usage of the Chinese characters ‘火币’ and ‘火幣’, which translate to ‘Huobi’ in English. As per Li, an agreement prohibits Huobi from using these terms in either simplified or traditional Chinese. He demanded that the company immediately cease this alleged infringement and warned that his legal representatives will issue a letter to Huobi urging them to stop this infringement activity. He also indicated the possibility of taking further legal measures depending on the circumstances to protect his legal rights and interests.

Adding to Huobi’s predicament, Justin Sun, the actual controller of Huobi, was charged by the U.S. Securities and Exchange Commission (SEC) on March 22. In an official press release titled “SEC Charges Crypto Entrepreneur Justin Sun and His Companies for Fraud and Other Securities Law Violations,” the SEC accused Sun of fraud and violating securities laws.

The troubles for Huobi Global further escalated on May 22 when the company received an order to halt its operations in Malaysia. This order adds to the global scrutiny that cryptocurrency exchanges are currently facing, and will undoubtedly influence Huobi’s future operations and its standing in the market.

These developments illustrate the mounting pressures and challenges in the cryptocurrency industry, with Huobi Global at the forefront. The unfolding events will surely shape the future landscape of crypto trading and regulation.


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Despite Closed Door, Justin Sun Says He’s Ready to Inject Billions into FTX – Report

The distress of FTX Derivatives Exchange and Sam Bankman-Fried’s call for help might be coming off with an impressive turnout as Justin Sun, the founder of the Tron blockchain has revealed his intentions to bail out the firm.


Speaking in an interview with BloombergTV’s Tom Mackenzie, Sun said he is ready to inject billions into FTX. While he pointed out that now is the time for the industry to come together and show solidarity, he said the purported aid will have to come following the conduction of full diligence.

Of all the major leaders in the crypto space, Sun comes off as the major person that has identified with the plight of Bankman-Fried. He unveiled plans to resume withdrawals for TRX, SUN, HT, and other tokens in the Tron Ecosystem. 

This is a relatively rare aid at a time when industry veterans are vocally bailing out on the embattled exchange. Binance, the bigger rival was looking at acquiring the trading platform and aiding it to survive its current liquidity crunch pulled away from the deal after a brief Due Diligence was conducted and indications that FTX might be under investigation by US regulators.

Since Binance pulled away, there has been no apparent aid from the exchange to date, a move that has characterized the broader industry. FTX reportedly asked for help from obviously liquid entities like Tether Holdings Ltd, the blockchain firm that is in charge of issuing the USDT stablecoin. 

As revealed in a tweet from Tether’s CTO, Paolo Ardoino, the stablecoin firm denied the aid for $1 billion from the Bankman-Fried-led exchange.

“Tether does not have any plans to invest or lend money to FTX/Alameda. Full stop,” Ardoino said in the tweet.

It remains unclear why the hash stance was taken by the Tether CTO but it might be as a result of the allegations that Bankman-Fried is always lobbying against industry players and the legal hurdles Tether has faced amongst the regulators now reportedly investigating FTX.

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Tron Founder Justin Sun Wants to Spend $5B to Save Distressed Crypto Firms

Tron blockchain founder Justin Sun is as empathetic about the current crypto firms that are distressed as he is willing to bail many out.


While there has been no news of Tron bailing out any crypto firm thus far, Sun said he is willing to commit as much as $5 billion to save distressed crypto outfits.

Sun confirmed the $5 billion funds it is willing to spend on to The Block after he tweeted that he is “friends with everyone and are always ready to serve,” a response to a Twitter user who said firms are forgetting Sun as a deep pocket crypto founder at par with the likes of Changpeng Zhao of Binance and Sam Bankman-Fried of FTX Exchange.


According to Sun, quite a number of troubled crypto startups have approached his establishment for help, adding that Tron has tapped the services of an Investment Bank to help in advising the startups to fund. He refused to name the bank it is working with due to the Non-Disclosure Agreement between both parties but said its core interests lie in projects that have a large user base.

“Our interest is platforms with a large user base,” Sun said. “Both CeFi [centralized finance] and DeFi [decentralized finance] platforms.”

Sun also noted that the companies he would be willing to bail out must have what it takes to withstand the rigors of the due diligence process that must be conducted. Sun believes the ongoing onslaught in the digital currency ecosystem is almost over with the targeted build-up of what is now necessary.

“I think currently the de-leverage process is passed the worst time. So we just need to clean it up and move forward. I don’t think [the] market will be super bullish, of course,” he said.

While Binance’s Changpeng Zhao believes not all projects are worth saving, the likes of BlockFi and Voyager Digital have recently received credit facilities from FTX Derivatives Exchange.

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