Circle, the entity behind the widely used USDC stablecoin, has announced the termination of its partnership with the TRON blockchain, sparking intense speculation within the crypto community. The decision, effective immediately, halts the minting of new USDC tokens on TRON, although existing transfers and swaps will continue until February 2025.
TRON's alleged financial irregularities and its ties to the CCP
A comprehensive report shared on social media platform X has shed light on the possible motivations behind Circle's move. The report reveals surprising revelations about the TRON ICO and the distribution of its TRX tokens.
concerns about centralization and possible manipulation within the TRON ecosystem, noting that TRON founder Justin Sun allegedly owned 17 of the top 20 TRX wallets, controlling over 98% of the token supply.
The investigation alleges a connection between these wallets and a network linked to the Chinese Communist Party (CCP), known for its involvement in cryptocurrency-related fraud and money laundering. A wallet associated with the PCC received a significant amount of Ethereum (ETH) from the ETH ICO in 2014/15.
Additionally, the report suggests that over $3 billion worth of Bitcoin on TRON last disappeared from an active contract on 11/11/2022, coinciding with FTX's financial woes.
Potential implications and risks
The findings raise concerns about possible financial irregularities, including Sun's creation of unbacked USDT (Tether), possibly exchanged for USDC, which could pose risks to the stability of stablecoins.
about scenarios in which Sun could print unbacked USDT, exchange it for USDC, and use the latter to offset unbacked holdings, potentially jeopardizing the integrity of the stablecoin market.
Additionally, the report highlights Sun and TRON's alleged ties to the CCP and entities such as cryptocurrency exchange Huobi, deepening concerns about the integrity and transparency of the ecosystem. These connections underscore the gravity of Circle's decision to distance itself from TRON, particularly in light of its ambitions for a public offering in the United States.
