(Bloomberg) -- The TRX token at the center of fraud charges against digital-asset mogul Justin Sun makes up a significant slice of the reserves at the Huobi Global crypto exchange, where the China-born entrepreneur is an adviser.

TRX — commonly referred to as Tron — comprises 18% of the reserves at Huobi, a major crypto platform, according to data from DeFiLlama. Doubts about the coin could reignite concerns over the strength of Huobi in a digital-asset sector fearful of collapses following the unraveling of the FTX exchange.

TRX, the native coin of Sun’s Tron ecosystem, slid almost 16% at one point on Wednesday after the US Securities & Exchange Commission accused him and his firms of market manipulation to make the token appear actively traded. The SEC also sued Sun for allegedly flouting securities rules. The 32-year-old rejected the charges, saying in a tweet that the SEC complaint “lacks merit.”

Another big chunk of Huobi’s reserves are in the exchange’s own coin, HT. Taken together, TRX and HT account for about 41% of the platform’s reserves. Crypto markets have become increasingly wary of native tokens after the implosion of FTT, the coin of FTX, contributed to the latter’s chaotic demise.

Crypto exchanges have tried to reassure that they have sufficient assets backing investor deposits, but are facing calls for full audits.

“Exogenous, stable and uncorrelated assets, whose success is independent of the exchange, serve as a better form of collateral,” said Kunal Goel, a research analyst at Messari.

Huobi’s total reserves stand at $3.1 billion, according to CryptoQuant. Excluding native tokens, the figure drops to about $1.8 billion — a metric CryptoQuant refers to as clean reserves. Huobi’s clean-reserve ratio is the lowest among the eight exchanges listed by the digital-asset data provider.

“There can be a risk in the exchange’s liquidity if a self-issued token holds a significant percentage of the total reserve amount,” CryptoQuant’s website states. 

When asked about the concentration of HT and TRX in its asset reserve, Huobi said it has a strong and healthy reserve pool in place to deal with any risks.

Stablecoin Injections

Sun this year twice injected $100 million of stablecoins — a type of token that’s meant to hold a constant $1 value — into Huobi to boost its financial cushion. 

The most recent transfer was earlier in March, as he tried to counter worries sparked by a flash crash in HT. The previous infusion was in January after Huobi was hit by a wave of withdrawals. Huobi said the combined $200 million of stablecoins came from Sun’s personal funds.

Sun last year spent about $1 billion to purchase a roughly 60% stake in Huobi, Bloomberg News reported in November. He’s denied owning the majority stake and says he’s just an adviser to the exchange.

Huobi, a platform with Chinese roots, has retreated from global leadership of crypto exchanges but still achieved $11 billion of monthly trading volume in February this year, data from CryptoCompare shows.

TRX recouped some of its Wednesday swoon in Thursday’s session, rising about 5% as of 8:45 a.m. in London, data compiled by Bloomberg show. HT has slumped some 9% over the past 24 hours, according to CoinGecko.

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