Author: Scof, ChainCatcher
Editor: TB, ChainCatcher
The cryptocurrency market was once again stirred by a stablecoin "de-pegging" event.
The protagonist this time is FDUSD, a stablecoin issued by the Hong Kong trust institution First Digital Trust (FDT), pegged 1:1 to the US dollar. Within a short hour, FDUSD's price plummeted from $1 to $0.97, briefly approaching $0.88, causing the market value to evaporate by hundreds of millions of dollars. More notably, this turmoil was not triggered by a technical vulnerability or external attack, but by an "unconfirmed" accusation on social media.
Event Review: Justin Sun's Single Sentence Sparks De-pegging
On the evening of April 2nd, Justin Sun posted a tweet on platform X, claiming that FDT, the issuer of FDUSD, had essentially gone bankrupt and was "unable to redeem", suggesting potential insolvency. This statement quickly spread in the crypto community, causing market sentiment to deteriorate rapidly. Just one minute later, FDUSD's price on Binance quickly fell below $1, and market panic spread.
Investors began massive selling of FDUSD, with some users even experiencing panic-driven position shifts. Within an hour, the FDUSD/USDT trading pair saw a volume of 770 million tokens, with a trading value of $745 million. The market fell into chaos.
It is understood that FDUSD is commonly used in Binance's Launchpool projects, where users can lock FDUSD to mine new token rewards. FDUSD is also the main alternative to Binance's native stablecoin BUSD.
Facing the FDUSD de-pegging event, FDT issued a statement in the early morning, firmly denying bankruptcy rumors and claiming that its reserve assets are sufficient, with all FDUSD backed by cash or US Treasury bonds, fully meeting the 1:1 pegging requirement. FDT also emphasized that the root cause was not FDUSD, but a reserve dispute with another stablecoin, TUSD.
Additionally, Binance member SiSi responded in a user group, saying: "FDUSD can be redeemed 1:1", citing He Yi's statement. Although this was not an official public statement, the message spread quickly in the community, and FDUSD's price subsequently recovered to around $0.98.
According to First Digital Trust's reserve proof data, as of February 2025, FDT's reserve assets are approximately $2.05 billion, with FDUSD's circulation at 2.04 billion tokens, showing a reserve coverage rate of over 100%. On paper, FDT is "not short of money".
Deeper Background: Old Accounts between Justin Sun and FDT?
This FDUSD controversy is actually a continuation of an old dispute.
FDT is not the first time Justin Sun has called them out. Previously, FDT was sued by Techteryx for serious issues managing TUSD's reserve funds. Court documents showed that some of TUSD's reserve funds were transferred to an unauthorized entity, Aria Commodities DMCC, during FDT's custody, causing a nearly $500 million fund gap. Ultimately, Justin Sun stepped in, providing emergency liquidity through a loan to support TUSD.
This "assistance" was clearly not free. Justin Sun subsequently began questioning FDT's asset safety, accusing them of chaotic and opaque management, even directly stating that FDT "can no longer redeem". FDT, in turn, insisted they were merely custodians acting on Techteryx's instructions, and accused Justin Sun of attempting to discredit competitors.
Prominent industry analyst Mirror Tang pointed out that such "regulatory black hole" asset transfers are not just a one-time operational error, but reflect structural risks in stablecoins. He warned that while the market expects Binance to have rigid redemption, if underlying assets have problems, platform credit backstopping is only a short-term relief that could ultimately amplify moral hazards.
Moreover, TUSD has faced multiple redemption difficulties in the past year, and its original operator TrueCoin reached a $500,000 settlement with the SEC for alleged false advertising. These negative news have compounded market concerns about FDT's overall credit.
Who is FDT?
[The rest of the translation follows the same professional and accurate approach, maintaining the original structure and meaning.]
