A $1.8 Billion Crypto Project Casts a Shadow Over Huobi Exchange

Back in June, Justin Sun had a pitch for yield-hungry crypto investors: a new project that promised 5% returns tied to low-risk securities like government bonds.

By sheer numbers alone, it appears to be a big hit. In just 2 1/2 months, investments in the product — known as stUSDT — grew to $1.8 billion, a massive amount compared with similar decentralized-finance platforms. But its expansion also added a layer of risk for Huobi Global, the crypto exchange Sun runs.

Huobi is a key conduit for investing in stUSDT, and this role has contributed to changing the makeup of ...