According to Chain, it is considering taking a lawsuit against the TRON founder Justin Sun, following claims that the company manipulates the market. The allegations came on January 24 when Justin Sun took to X to post that Chain was using high leverage along with contracts that could harm users of exchanges.
Sun’s Allegations
In his post, Justin Sun called on major crypto exchanges such as Coinbase, Kraken, and Bybit to keep Chain under tight surveillance. He continued and said that he would indeed file the firm’s “illicit activities” with the SEC and DOJ for an investigation. Though making some serious allegations, Justin Sun did not give the public elaborate information to back up his claims.
Ben Zhou of Bybit commented on the post saying that his risk team is on the lookout for manipulative behavior.
Chain’s Response
The chain was quick to deny Justin Sun accusations. This company backed by Pantera Capital, Citigroup, noted in a statement that it does not trade or manipulate its native token XCN on any market. XCN is controlled by OnyxDAO, an independent decentralized organization, and not Chain, the firm said.
In reaction to Justin Sun’s accusations, Chain revealed that it intends to pursue “legal remedies” regarding what it claimed were false allegations.
Background and Market Reaction
The drama developed as XCN skyrocketed 149% within a day and 400% within the last week. The feud notwithstanding, investors seem unbothered; XCN’s market cap has surged to $746.41 million.
Meanwhile, TRON’s native token, TRX, has had a poor run at retaining its position. According to Sun, the current market is an opportunity to “buy the dip.”
The legal battle between Chain and Justin Sun not only adds to the fast-changing nature of the cryptocurrency scene but also sees observers awaiting potential regulatory interventions in the situation that now unfolding.
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