Since he had no other option, he refused to back down and said to Loki, "Trust me when I say that I am not bluffing. I will tell everyone I know about your secret, including the fact that you can assimilate Cave Heaven and law fragments of different kinds."
"I will hold nothing back. After all, I have nothing left to lose."
He isn't actually sure that Loki can assimilate law fragments of various kinds. But he is suspicious of it because he didn't recognize Loki as any swordsman of his sect or see any signs of the law fragments of the Sword Pathway on Loki. Yet, Loki was able to absorb the law fragments in his Cave Heaven without any adverse reaction.
This is something he saw at the beginning of their fight in his Cave Heaven. And if his suspicion were true, it would explain how Loki could create the trail of emptiness in the second heaven.
His thought process seems reasonable to him. He just doesn't have concrete proof, which is why he is not sure of his accusation.
