Amid the crypto market downturn, rumors emerged that Tron founder Justin Sun’s positions had been liquidated. Sun denied the rumors and criticized the fear, uncertainty, and doubt in the community, pledging to create a fund to help the industry.
Justin Sun denies liquidation rumors
Over the weekend, the cryptocurrency market experienced a major decline that saw its market cap drop below $2 trillion. As a result, hundreds of thousands of positions were liquidated, with the value rising to over $1 billion.
Related Reading: Here’s Why Bitcoin and Ethereum Prices Are Crashing
As reports of massive liquidations mounted, the community began to speculate about the entities that were responsible for some of the $372 million in Ethereum (ETH) liquidations. One report caught investors’ attention after it claimed that “Justin Sun has finally been liquidated.”
The rumors intensified when Arthur Hayes, co-founder of cryptocurrency exchange BitMEX, shared on X that “someone big got scammed, and is dumping all the crypto.” According to Hayes, the information came from his “TradFi birdies” but he did not share any names.
Community speculates about Sun's liquidations. Source: Arthur Hayes on X
Some have speculated that Hayes was referring to Tron’s founder and his team, which has seemingly heightened concerns and suspicions. However, Sun said that Hayes was referring to Tron’s founder and his team. It has been clarified. He insisted that the rumors were false and was highly critical of leveraged trading strategies, stating that they “rarely engage” in such strategies because they do not believe they are beneficial to the industry.
In addition, he stressed that he prefers activities that “provide greater support to the industry and entrepreneurs, such as warehousing, operating contracts, working on projects, and helping project teams provide liquidity.”
After clearing up the liquidation rumors, blockchain analysis firm Spot on Chain revealed that Sun’s wallet took a hit following the crypto market’s plunge. According to a reportSun’s ETH holdings saw a massive drop in value after the second-largest cryptocurrency dropped 20%.
Sun reportedly bought 377,590 ETH since February 2024 at an average price of $3,051. His portfolio suffered losses of $280 million after the ETH trading price fell below the average purchase price over the weekend.
$1 Billion Crypto Fund to Combat Doubt, Suspicion, and Uncertainty
Following his clarification, the Tron founder also pledged to provide assurances to the crypto community. He believes that investors should not worry about a market crash because the industry has “grown significantly over the past year.”
Sun also suggested that market volatility is “not due to negative news” and refused to participate in the ongoing state of fear, doubt and uncertainty. For him, the community should reject fear and uncertainty and “continue to build” the sector. As a result, he announced the creation of a fund to combat negative sentiment and invest in the cryptocurrency industry.
Sun annouces fund to fight FUD. Source: Justin Sun on X
According to the post, the $1 billion fund will be used to “combat fears and doubts, invest more, and provide liquidity,” but no further details about the project have been revealed yet.
The crypto community has criticized Sun’s proposal, claiming that the Tron founder has made “false claims” in the past. Meanwhile, others have questioned the purpose of the funds, wondering whether they will be used to “pay Twitter bots” or “hire units to combat fear and doubt.”
Investors claimed that Sun was “creating fear, doubt and suspicion to combat fear and suspicion,” while others asked him to “buy back $1 billion worth of assets,” as he offered during the German government’s bitcoin sale. However, some community members praised his efforts to reassure the community during the market turmoil.
Ethereum is trading at $2,242 in the three-day chart. Source: ETHUSDT on TradingView
Featured image from Unsplash.com, chart from TradingView.com