- First Digital calls Justin Sun’s FDUSD insolvency claims ‘false’, asserts full backing
- FDT accuses Sun of ‘smear campaign’, avoiding legal routes for TUSD issues
- FDT plans Q&A today (Thurs) & legal action; Sun’s claims followed FDUSD dip
First Digital Trust (FDT), the issuer of the FDUSD stablecoin, has come out strongly against Tron founder Justin Sun’s warnings on their stablecoin’s safety. In an X post, First Digital called out Sun’s “false statements,” asserting the FDUSD stablecoin remains fully backed by US Treasury bonds and assured users of its safety.
First Digital Refutes Justin Sun’s Claims, Asserts FDUSD Backing
First Digital clarified that the ongoing compliance dispute with Hong Kong regulators, highlighted by Sun, only involves TUSD, a stablecoin issued by Techteryx, not FDUSD or FDT.
First Digital asserted their stablecoin is financially sound with full solvency. FDT also added that the backed funds are safe and traceable, even listing the ISIN numbers for reserves in their reserve report.
Related: FDUSD Hits $1B Market Cap as Binance Ceases Support for BUSD
First Digital Accuses Sun of ‘Smear Campaign’
The stablecoin issuer expressed displeasure with Sun, accusing him of engaging in a “smear campaign” against business competitors.
First Digital claimed Sun has avoided pursuing legal means to resolve a three-year issue involving TUSD.
FDT accused the Tron founder of using social media to damage competitors’ reputations, discourage investors, and negatively influence public opinion about FDUSD. First Digital stated its intent to take legal action to safeguard its rights and reputation.
Context: Sun’s Earlier Allegations on FDUSD Volatility
Sun had previously accused First Digital of insolvency, claiming the stablecoin issuer could not fulfill client fund redemptions.
In a Wednesday X post, Sun alleged significant loopholes in FDT’s Hong Kong trust licensing and other internal risk management issues.
Related: FDT Insolvency Buzz, FDUSD Depeg Stoke Fears: Hong Kong Oversight Questioned
Sun’s allegations surfaced as FDUSD faced heightened scrutiny following its unusual volatility. The stablecoin’s price dropped to $0.9700 on Binance before recovering towards $0.9900, with high sell-off volume (287 million tokens) over a 4-hour window in an uncertain market.
First Digital announced plans to hold a Q&A session on X today (Thursday) to address the situation and clarify doubts for community members.
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