The award led to a burst of publicity that enhanced the credibility of the 30-employee company, which had issued bitcoin-like tokens that at their peak were worth more than $2 billion.
A lawyer for Power Ledger, who confirmed the financial company's relationship with Mr Tai, threatened the Financial Review with further legal action if it reported on the connections.
"In so far as the implication is that Power Ledger utilised 'inside connection' to win the competition, it is completely without foundation and offensive," the lawyer said.
"Mr Tai was an ambassador appointed in 2017 and was paid a one-off fee in 2017. He founded the Extreme Tech Challenge but was not a judge in the competition.
"The finals of that competition were in October 2018 - significantly after the time when Mr Tai was appointed an ambassador."
Mr Tai, a kite-surfing blockchain entrepreneur who describes himself as a "VC, educator and athlete", didn't respond to several requests for comment.
He was also an investor in Revl, a San Francisco camera manufacturer that was one of the other finalists in the 2018 competition, according to an article on the Revl website.
"We did it!" Power Ledger said in a post when it won. "We'd like to thank the judges for sharing our vision in reimagining our energy future as well as our dedicated community, whose unwavering support has helped us stay focused on the important work in front of us."
Mr Tai wasn't a member of the three-judge panel. But one of the judges was businessman Valery Vavilov, who has described Mr Tai as a "friend". The two men are directors of Dutch-American Bitcoin miner Bitfury.
The other judges were Sir Richard and Koichi Narasaki, a Japanese insurance executive.
The stated aim of the Extreme Tech Challenge, also known as XTC, is "to elevate the next-generation of entrepreneurs creating new technologies and innovations to benefit humankind".
"XTC provides top contenders the funding, strategic partnerships, and mentorship they need to pioneer technological breakthroughs and help power a sustainable future," the contest's website says.
Power Ledger is suing the Financial Review in the West Australian Supreme Court over articles published in December that raised questions about how the company raised $34 million for its blockchain tokens, and the effectiveness of its electricity-trading system.
Mr Tai was last year awarded an honorary doctorate by Perth's Curtin University, where he is an adjunct professor.
Power Ledger's cryptocurrency has fallen from US8.8¢ since trading began in late 2017 to US5.5¢ on Tuesday, according to Coincodex.