Justin Sun’s Tweet Shakes FDUSD’s Stability
The stablecoin FDUSD deviated from its dollar peg by approximately 12% following Justin Sun’s claims about the insolvency of First Digital Trust (FDT).
First Digital Trust, a Hong Kong fiduciary firm, was hired by Techteryx to manage the reserves of the stablecoin TrueUSD. According to CoinDesk, a $456 million deficit emerged in the project’s balance sheet during 2023–2024, linked to FDT’s activities.
Court documents reveal that the firm was supposed to invest the reserve funds in the Aria Commodity Finance Fund (Aria CFF) in the Cayman Islands but instead directed the money to Aria Commodities DMCC, an unauthorized fund registered in Dubai.
Matthew Britten, listed as the manager of Aria CFF, told reporters that the two funds are interconnected—DMCC handles trading, while CFF provides financing for deals.
In 2022, Techteryx attempted to recover the funds, but the fund could only return a small portion. Sun then extended a loan to Techteryx to facilitate the redemption of coins.
On April 2, in response to the CoinDesk report, the entrepreneur tweeted, declaring FDT incapable of fulfilling client fund redemptions.
First Digital Trust (FDT) is effectively insolvent and unable to fulfill client fund redemptions. I strongly recommend that users take immediate action to secure their assets. There are significant loopholes in both the trust licensing process in Hong Kong and the internal risk…
— H.E. Justin Sun ? (@justinsuntron) April 2, 2025
He advised users to withdraw funds and urged regulators to address deficiencies in the licensing and risk management systems.
The statement triggered a sell-off of First Digital Trust’s stablecoin, FDUSD, causing a temporary price drop to $0.88. At the time of writing, the chart had stabilized at $0.98.
Sun also promised to reveal more details at a press conference on April 3.
First Digital refuted Sun’s claims, assuring full backing of FDUSD, citing relevant financial reports.
The recent allegations by Justin Sun against First Digital Trust are completely false.
This dispute is with TUSD and not with $FDUSD. First Digital is completely solvent.
Every dollar backing $FDUSD is completely, secure, safe and accounted for with US backed T-Bills. The…
— First Digital (@FirstDigitalHQ) April 2, 2025
FDT described the entrepreneur’s statements as a “smear campaign” and “an attack on a competing business.” The firm intends to defend its interests in court.
On April 3, FDT representatives will hold their own AMA session regarding the disputes.
Back in March, Justin Sun appeared on the cover of Forbes, prompting TRX trading volume to surge above $500 million.
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