Chain Threatens Legal Action Against TRON Founder Justin Sun Over Market Manipulation Allegations

Blockchain protocol Chain is considering taking legal action against TRON founder Justin Sun after he accused the company of market manipulation.

Chain, a blockchain firm backed by over $40 million from investors including Pantera Capital and Citigroup, has threatened to take action against Sun following his allegations. In a recent post, Sun claimed that Chain was using “high leverage and contract that could cause serious harm to many exchange users.”

XCN @chain is currently engaging in significant market manipulation. They are using high leverage and contract that could cause serious harm to many exchange users. I recommend that major exchanges pay close attention to this risk. We will report their illegal activities to the…

While Sun did not provide details about the alleged manipulations, he warned crypto exchanges to exercise caution and stated that he would “report their illegal activities to the SEC and DOJ for further investigation.” He also tagged major exchanges, including Coinbase, Kraken, and Bybit, urging them to take action.

Chain Rejects Market Manipulation Accusations

Chain was quick to respond, rejecting Sun’s allegations. In a follow-up post, the company stated that it is “not actively engaged in ANY trading of XCN, nor involved in ANY market manipulation directly or indirectly.” Chain further clarified that the XCN token is managed by OnyxDAO and announced plans to explore “legal remedies” against Sun over his claims.

The Chain team is not actively engaged in ANY trading of XCN, nor involved in ANY market manipulation directly or indirectly. We take these allegations extremely seriously and are exploring legal remedies against @JustinSun. XCN is managed by @OnyxDAO and not by @Chain.

Key Facts About Chain

Here are some key facts about Chain:

  • Founded in 2014
  • Raised over $40 million in funding from investors including Khosla Ventures, Pantera Capital, Capital One, Citigroup, Fiserv, Nasdaq, Orange, and Visa
  • Acquired by Stellar in 2018 to form Interstellar, a commercial arm of the Stellar Foundation
  • Re-acquired in 2020

As the situation unfolds, it remains to be seen how the allegations and potential legal action will impact Chain and the wider cryptocurrency market.

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