Last night (Hong Kong time), Justin Sun, co-founder of Tron Blockchain, accused the first digital trust involved bankruptcy, triggering serious FTUSD Stablecoin. The move is believed to be retaliation against past tensions between the First Number and Techteryx, a company owned by Sun.
Justin Sun’s allegations and FDUSD DEPEG
On April 2, 2025, Justin Sun warned X about the first digital trust, noting: “First Trust (FDT) is effectively paying debts and cannot fulfill the exchange of client funds. I strongly recommend that users take immediate action to secure their assets.”
Protect users and protect Hong Kong
First Digital Trust (FDT) is effective in repaying debts and cannot achieve redemption of client funds. I strongly recommend that users take immediate action to secure their assets. There are significant loopholes in the trust licensing process.
—He Justin Sun (@justinsuntron) April 2, 2025
Sun also criticized Hong Kong’s financial system, urging regulators to intervene to prevent further losses. The position gained significant appeal and triggered a direct response from the market. FDUSD is a stable stablecoin designed to maintain a 1:1 peg dollar, down to as low as $0.87 (13% depeg), which is Sun’s statement.
DEPEG has had a profound impact on the second-hand persistent impact of the world’s largest crypto exchange. On-chain data estimates that 94% of FDUSD supply (about $2.2 billion) is traded in second-hand stocks, of which $1.5 billion belongs to users, while the exchange itself holds $700 million. If Sun’s allegations of FDT bankruptcy are correct, Binance could face significant liquidity issues that could undermine its operations and boost confidence on the platform. The incident also caused FDUSD’s market value to drop by $130 million, highlighting the scale of the crisis.
First Digital Trust and Binance’s response
The First Digital Trust quickly refuted Sun’s claim, marking it as part of the “false” and “slander campaign.” The company clarified that the dispute involved Trueusd (TUSD), not FDUSD, and stressed that FDUSD is still completely solvent and is backed by a U.S. fiscal bill 1:1. FDT announced plans for AMA on X Space on April 3 to openly resolve the issue and threaten legal action against Sun to protect its reputation.
Justin Sun’s latest allegation against the First Digital Trust is completely wrong.
This controversy is related to TUSD, not $ fdusd. The first number is completely solvent.
Support per dollar $ fdusd Completely, secure, secure, and addressed in our supported T-Bills. this…
– The first number (@firstdigitalhq) April 2, 2025
Binance also issued a statement reiterating that FDUSD’s reserves are fully supported and transparent and demonstrated sufficient liquidity to pay for redemption. The exchange is committed to ongoing monitoring of FDUSD stability and plans to review it after the next proof report within two weeks.
Binance has released an update on the FDUSD certification report, which confirms full 1:1 support.
We remain committed to ensuring that our users are informed and will continue to provide timely updates.
More information 👉 https://t.co/4jjfd0ot5f pic.twitter.com/se1yhaucfs
– binance (@binance) April 3, 2025
Following these guarantees, FDUSD began to recover and by the morning of April 3, it rose to a ratio of 1:0.99 compared to USDT. Although some concerns have been alleviated by partial recovery, doubts about the long-term stability of FDUSD remain, especially due to its heavy reliance on binary ecosystems.
Source: Coingecko
The root cause of the incident
The root of this incident is reportedly the first digital trust has been linked to past tensions between the Techteryx (Tusd) issuer (TUSD) and Justin Sun. Court documents recently revealed that Techteryx sued FIND TRUST’s CEO Vincent Chok after FDT allegedly redirected $456 million in TUSD reserves to unauthorized circumstances.
A Dubai-based entity, ARIA Commodity DMCC, transferred the funds to the Cayman Islands-based ARIA Commodity Finance Fund and invested it in high-risk projects such as mining and renewable energy. Techteryx faces a $456 million shortage from 2023 to early 2024, prompting Sun to inject emergency liquidity to stabilize TUSD.
TUSD was once Binance’s stablecoin, a replacement for BUSD, which ceased operations in 2023. TUSD’s market value then soared from $1 billion in October 2023 to a peak of $3.8 billion, accounting for 90% of its total binary supply. But then this exchange gradually phases it out in support of FDUSD.
FDUSD is a stable stable stock with a relatively high trading market capitalization in binary terms, only lagging behind trading pairs involving USDT. It is worth noting that Binance investors can also leverage FDUSD to participate in recent Binance Launchpool programs such as Gunz (Gunz), Nillions (NIL), Redstone (Redstone (Red), BIO protocol (BIO), and more.
