Image default
Crypto

Justin Sun Moved $6M Stablecoins From TrueFi Lending Pools Before FTX-Alameda Bankruptcy

Facebook iconLinkedin iconTwitter iconFacebook iconLinkedin iconTwitter icon

Justin Sun, founder of the Tron network and a one-time, potential savior of the insolvent crypto exchange FTX, moved $6.1 million in stablecoins from decentralized lending protocol TrueFi, which is among companies weighted down by FTX sister company Alameda Research’s debts.

Transaction data on the blockchain shows that Sun withdrew the funds in four transactions processed Thursday. He moved $2.4 million of USDT, 2.1 million of USDC, $1 million TUSD and $673,000 in BUSD from the four available credit pools on the lending protocol.

CoinDesk - Unknown

Justin Sun withdrew funds from TrueFi pools Thursday, according to blockchain data. (Arkham Intelligence)

The crypto wallet has been identified as Sun’s by crypto intelligence platforms Arkham Intelligence and Nansen.

Justin Sun and representatives of TrueFi had not replied to requests for comment at the time of publication.

TrueFi is a decentralized lending protocol where liquidity providers can lend money for a yield, and borrowers can take out loans for interest. The loans are uncollateralized, meaning that creditors do not pledge assets against it. Borrowers secure the loan with only their good financial standing and trust.

The withdrawals are another sign of an ongoing liquidity crunch in crypto credit markets following the sudden implosion of FTX and Alameda Research, a trading firm.

Alameda Research has a $7.3 million outstanding debt on TrueFi’s Capital Markets credit facility, managed by TrueTrading. Alameda’s bad debt represents almost half of all current outstanding loans on the protocol, according to TrueFi’s dashboard. After Alameda filed for bankruptcy protection Friday, chances are low that it will be able to repay the loan.

TrueFi has already been rocked by two recent loan defaults. South Korea-based Blockwater defaulted on a $3 million debt despite restructuring efforts, and Invictus Capital didn’t pay back a $1 million loan by the maturity date after it filed for court-assisted liquidation earlier this year.

The total value locked on TrueFi cratered to $32 million from $544 million in the last six months as appetite for crypto borrowing dwindled, according to decentralized finance data site DefiLlama.

Read more: TrueFi’s $4M Bad Debt in Limbo Shows Risk of Crypto Lending Without Collateral

Trending1Chart of bitcoin's price in 2022 reflects what a horrible year it has been in crypto markets – made worse by the FTX collapse. (CoinDesk)MarketsAfter Bitcoin's Worst Week in Five Months, Here's What Crypto Analysts Are SayingNov 14, 20222Fresh fears emerged Monday in crypto markets. (John Ward McClellan via National Gallery of Art, modified by CoinDesk)MarketsFirst Mover Asia: Extreme Fear Hits Crypto as FTX Hack Makes Bad Situation Worse. What Comes Next? Nov 14, 20223Trust Wallet Token performance through Nov. 2022MarketsBinance CEO Zhao Pushes for Crypto Self-Custody; Trust Wallet Token Soars 80% to RecordNov 13, 20224Sam Bankman-Fried, FTX CEOPolicyBankrupt FTX Faces Criminal Investigation in the BahamasNov 13, 2022

Source coindesk.com

Related posts

Americans See Inflation Plunging Next Year, New York Fed Survey Finds

Blake Goodwin

Goldman’s Bullish Dollar Forecast Could Spell More Bad News for Bitcoin

Blake Goodwin

Cryptocurrencies XRP, MKR Shine as BTC, ETH Hold Steady Ahead of US Inflation Data

Blake Goodwin

Leave a Comment