A major stablecoin, FDUSD, took a hit this week after a prominent figure in the crypto world accused its issuer of insolvency.
Sun’s Explosive Allegations
Crypto billionaire Justin Sun, founder of Tron, publicly accused First Digital Trust (FDT), the Hong Kong-based company managing FDUSD, of being bankrupt and unable to repay investors. He urged people to pull their money out immediately, warning of significant problems with Hong Kong’s financial system. Sun also called for regulatory intervention to protect investors and safeguard Hong Kong’s financial reputation.
FDUSD Fights Back
FDT strongly denied Sun’s accusations, calling them a smear campaign by a competitor. They insisted FDUSD is fully backed by US Treasury bills and that all reserves are accounted for. The company stated that it will be taking legal action against Sun.
Market Reaction and Current Status
FDUSD briefly dropped to around $0.95 but has since partially recovered, trading slightly below its $1 peg. The situation highlights the risks involved in the cryptocurrency market and the ongoing debate about stablecoin regulation.
Disclaimer:
This information is for general knowledge and shouldn’t be considered investment advice. Always do your research before investing in cryptocurrencies.
