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Justin Sun Yuchen
Reuters
Crypto-entrepreneur with Chinese characteristics.
REALLY SORRY

Justin Sun praises China’s socialism in apology amid pressure from authorities

By Jane Li

Justin Sun, the Chinese crypto-entrepreneur who made headlines with his abrupt cancellation of a lunch date with Warren Buffett earlier this week, issued a long apology today (July 25) in a show of loyalty to China’s regulators amid reports of him being investigated by the authorities.

“I was really fortunate to grow up alongside the rapid development of socialism with Chinese characteristics in our country, as well as reaping dividends from the development of the global blockchain industry… I could say, without the caring and guidance from the regulators, the blockchain industry would not flourish as it does today,” Sun posted (in Chinese) on Chinese social network Weibo. Sun apologized for “overmarketing” his Tron Foundation, a crypto-based entertainment platform, and said he would cooperate with the authorities to explain his blockchain business better and meet their requirements, without elaborating further.

Sun’s spokesperson did not reply to a request for comment.

The possibility of a Chinese probe of Sun, reported by Chinese media on Monday after the lunch cancellation, comes a month after investors in China complained that Tron failed to act against a scam project that went by a similar name to Tron’s Chinese name, Bo Chang, or Wave Field. The project vanished abruptly, leaving investors out some $30 million. In an earlier statement (in Chinese) on Weibo, Sun said Tron reported the case to the police and doesn’t have any ties to the project.

China has been growing increasingly wary of investing activities that it deems as risky and speculative, including crypto currency, both due to the instability that could arise from angry investors and the possibility of rich residents using virtual assets to transfer their wealth overseas. As a result, China has banned all initial coin offerings and crypto currency exchanges since September 2017. Amid this scrutiny, a number of prominent Chinese business figures have disappeared in recent years and later resurfaced in courts facing charges of financial misconduct. These include Wu Xiaohui, the former chairman of insurance giant Anbang Group, which owns New York’s Waldorf Astoria hotel, who was sentenced to 18 years in jail last year after he mysteriously vanished from view in 2017, and actress Fan Bingbing who faced a tax-evasion scandal last year.

Sun, who has relocated to San Francisco, is still active in the global crypto community and heavily promotes Tron, which now mainly hosts gaming related dapps (decentralized app), on Twitter and Weibo. However, increasing pressure from authorities may have led Sun to feel the need to show support for Beijing’s move to “get rid of financial risks,” as Sun said in his apology, say observers.

Sun back-and-forth statements in the past three days have riveted—and confused—the crypto world. It started on Monday (July 22), when Sun announced that he would cancel the highly anticipated meal that would have seen him sit down today with “the Oracle of Omaha,” who famously called crypto “rat poison squared.” The 29-year-old entrepreneur won the lunch with a record $4.5 million bid in a charity auction in June, and said he would try to persuade Buffett to change his view on the virtual asset.

Sun said at the time the cancellation was because of his “kidney stones,” but reports from Chinese media, including reputed financial publication Caixin, soon suggested that he could not attend the lunch because of an investigation initiated by the Chinese authorities into allegations that included illegal fundraising. Sun was effectively banned from leaving China, according to Caixin. Sun swiftly denied that, saying the report “was completely untrue” (in Chinese) on Weibo, according to the Chinese publication the 21st Caijing. That Weibo post appears to have been deleted as of Thursday.

To emphasis that he was not in China, Sun took to Twitter to post a video showing himself at his home in San Francisco on July 24. Yahoo Finance also quoted Sun’s spokesperson as saying he “was not aware of any travel ban” on Sun.

In a later Tweet, a cheerful-sounding Sun announced that he felt “so much better” and would be on track to be back to work by Friday. But hours after, he posted the apology on Weibo, fueling more speculation as to his current status.