More than thirteen years after BitTorrent Inc. entered Silicon Valley as one of the hottest new startups, the company is getting close to being acquired. Justin Sun, the founder of the cryptocurrency TRON, is planning to take the company in and both parties are finalizing the latest details. With a multi-billion dollar market cap, TRON aims to decentralize the web, partly powered by BitTorrent.
Founded by BitTorrent inventor Bram Cohen, BitTorrent Inc. is best known for its torrent client uTorrent, which has more than 100 million users.
Despite this massive userbase, however, the company never transformed into the next billion-dollar tech giant, as some as the early investors had hoped.
In fact, it has only gone downhill in recent years, in part due to questionable management practices. Things have calmed down since, but according to new information gathered by TorrentFreak, there is a major change afoot.
A few weeks ago we reported that BitTorrent Inc. quietly renamed its company to “Rainberry” last year. The company informed us that this was “purely a corporate decision.” While that may be the case, it could also be related to the company’s plans to be acquired.
Legal paperwork filed earlier this year reveals that Rainberry was sued because it allegedly violated a “No Shop” clause in an agreement with a potential buyer. This potential buyer, who signed a letter of intent, is none other than TRON founder Justin Sun.
TRON is one of the hottest and controversial cryptocurrencies. After a successful ICO, it now has a market cap of more than $4 billion, only surpassed by a few others. And with Sun at the helm, it makes headlines nearly every day.
The TRON mainnet, which will go live in a few days, has the ultimate goal to “decentralize the web.” BitTorrent would fit well in this picture, and the TRON whitepaper mentions torrents as one of the pillars.
Sun first began pursuing the acquisition of BitTorrent Inc.’s assets in September last year. In January 2018, both parties finalized a letter of intent for the acquisition, of which Sun returned a signed copy.
While it appeared that things were moving along nicely, BitTorrent Inc. CEO Ro Choy came back with a surprising reply.
“Within literally hours after the parties agreed to the Letter of Intent, and after Ro Choy began performing the terms of the Letter of Intent, Defendant claims it received three ‘superior’ bids from companies that David Chao admitted they had been communicating with,” Sun claims in the lawsuit.
Sun asked the court for a restraining order to prevent BitTorrent from talking to other potential buyers, as was agreed in the letter of intent. The case was swiftly dismissed, but not without leaving a paper trail.
While it is clear that TRON’s founder is eager to acquire BitTorrent, less is known about what happened afterward. Did both parties throw their letter of intent in the trash mid-February, or was the deal still on?
Then, our research pointed out another interesting fact which suggests that the deal is going forward. At the end of February, right when the exclusivity period set in the letter of intent ended, a holding company named “Rainberry Acquisition” was registered in California.
This company is registered to none other than TRON founder Justin Sun, who completed the statement of information last month, as can be seen below. And the name clearly suggests that the acquisition is still on the table.
TorrentFreak reached out to Justin Sun, but TRON’s founder did not immediately reply to our request for comment.
When we confronted BitTorrent Inc. with the information, the company confirmed our findings and the interest from Sun, but it noted that the acquisition is not 100% finalized yet. More information will likely be released at a later stage, if all goes well.
At this point, Sun’s plans for BitTorrent Inc. remain unclear. He has not spoken about the acquisition in public, obviously, but it’s likely that it will be used to the advantage of TRON.
Interestingly, BitTorrent Inc. founder Bram Cohen has also taken an interest in cryptocurrencies, with the goal of creating a superior one called Chia. As far as we know, he is not part of TRON’s future in any way.
A copy of Sun’s complaint against Rainberry (f/k/a BitTorrent) is available here (pdf).
An earlier version of this article stated that the court dismissed the case. However, it appears that Sun requested this dismissal through his attorney. We updated the article to reflect this