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Cryptocurrency News Articles
Justin Sun's Empire Expands as He Joins New WBTC Joint Venture With BiT Global and BitGo
Aug 15, 2024 at 01:03 am
Justin Sun will be part of a new joint venture with BiT Global (a Bithumb company) and BitGo to operate Wrapped Bitcoin (WBTC) products. However, a close review of BiT Global's corporate filings shows concerning connections to Sun's empire.
Justin Sun is set to be a part of a new joint venture between BiT Global (a Bithumb company) and BitGo to operate Wrapped Bitcoin (WBTC) products. However, a close look at BiT Global’s corporate filings reveals some interesting connections to Sun’s empire.
BitGo founder and CEO Mike Belshe took to the MakerDAO forums to defend the new joint venture, stating that Sun was “not in the management team of BiT Global nor does he have any key material access.” He also further encouraged people to “confirm that BiT Global is a licensed TCSP in Hong Kong.”
BiT Global Trust Limited is a licensed TCSP in Hong Kong (license number TC009340), but a close review of corporate records suggests that Sun may be deeply involved with the firm.
The Hong Kong corporate registry lists two directors for this firm: Zhihong Liu and Yiying Jiang.
Yiying ‘Jennifer’ Jiang is also involved with other firms that have ties to Sun. This includes previously serving as a director for DTV Limited, a firm connected to BitTorrent that’s owned by Sun. Additionally, Jiang also served as a director for Augustech LLC, a firm that was set up to provide services to Sun-owned Poloniex.
Jiang was also listed as the individual who owned Huobi Technology Europe Ltd. before it was dissolved. Sun has claimed he is only an adviser to HTX (formerly Huobi). Jiang was also a director for The TRON Network Limited and is the executive who signs the attestation reports for TrueUSD, in her role as an executive for Techteryx.
TrueUSD has previously denied that Sun owns the firm, but he was listed as an ‘Asia Market Advisor,’ and the former chief exec of the firm has alleged that Sun tried to acquire the stablecoin.
Belshe highlighted during an X Spaces that regulations prevent any shareholder from holding more than 1/5 of the trust firm. Interestingly, the corporate registry for BiT Global Trust Limited lists five shareholders, all based out of the same address in the British Virgin Islands:
The last one is particularly interesting because Sun is a well-known fan of author Ayn Rand.
The WBTC DAOs
Belshe while speaking in the Spaces call highlighted that there are two decentralized and autonomous organizations (DAO) that manage WBTC.
There’s a small DAO that approves merchants and a large DAO that, according to Belshe, “owns the smart contract” and “picks, you know, how we do custody of this thing.”
Despite this claim, it doesn’t seem that the large DAO was consulted on this change in custody for WBTC.
There was further confusion during the Space, with Belshe originally claiming that WBTC has no ‘freeze’ function. However, a member of one of the DAOs later claimed that there’s a way for the DAO to freeze all tokens.
A review of the smart contract for WBTC on Ethereum does include a ‘pause’ function, but it would pause all tokens. Belshe probably meant no ability to freeze a single address like Circle, Tether, or other stable-asset issuers.
Protos reached out to BitGo for comment on why the large DAO has not voted for this change, and whether or not a freeze function exists but it was unwilling to respond on the record before publication.
Why does this matter?
There were very few details shared in the press release that announced this new WBTC joint venture about how custody and control of the keys will function. It stated that this transition would result in “diversifying both custodial jurisdictions and locations for the underlying bitcoin,” and further noted that it “will continue to use the same BitGo multi-signature technology and deep cold storage, with the only difference being the ability to distribute keys in multiple locations around the world.”
In a recent X Spaces, Belshe provided some clarification on how the keys will be custodied, noting that BiT Global will have one of the primary keys and the backup key, while BitGo will have the second signing key. This seems to mean that if it used the backup key, BiT Global could potentially move these bitcoins.
Since the Space, BitGo and BiT Global have decided to modify the plan, now intending to hold one key with BiT Global, one with BitGo Inc. in the United States, and one with BitGo Singapore Ltd.
We co-hosted a WBTC community discussion last night on X Spaces with @weremeow, @loi_luu, @mikebelshe. Thank you to the hundreds who participated live and the thousands who tuned in after.
BitGo recapped the WBTC new multi-jurisdictional, multi-institutional custody transition… pic.twitter.com/dObsuoVO3i
It seems Belshe is less concerned with the possibility of bad behavior from BiT Global, noting that its legal role
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