tl;dr
First Digital Trust (FDT) refutes Justin Sun's insolvency allegations regarding its stablecoin FDUSD, asserting that it is fully backed with US Treasury bills. Sun's claims caused FDUSD to break its peg, raising concerns about its solvency and Binance's exposure, as the platform holds a significant ...
First Digital Trust (FDT) has refuted insolvency allegations made by Justin Sun regarding its stablecoin FDUSD, asserting that it is fully backed with US Treasury bills. Sun's claims caused FDUSD to break its peg, raising concerns about its solvency and Binance's exposure, as the platform holds a significant amount of the asset.
FDT emphasized that the dispute involves TrueUSD (TUSD), not FDUSD, and plans to take legal action to protect its reputation. Binance's deep integration of FDUSD into its ecosystem raises operational and reputational concerns following the instability, prompting renewed scrutiny of Binance's due diligence and risk assessment practices regarding third-party stablecoin issuers.
First Digital Trust denied Justin Sun's insolvency allegations and stated that its stablecoin is fully backed with US Treasury bills. Sun's allegation caused FDUSD to break its peg, raising questions about the stablecoin's solvency, the transparency of its issuer, and potential implications for Binance, which holds a significant amount of the asset.
First Digital emphasized that the dispute involves TrueUSD (TUSD), not FDUSD, and asserted that all FDUSD reserves are fully backed and verifiable through US Treasury Bills. The company added that the specific ISIN numbers for the reserves are documented in its attestation report. It labeled Sun's statements as a smear campaign to attack a competitor and plans to pursue legal action and hold an AMA event to protect its rights and reputation.
Binance holds approximately 94% of the FDUSD supply, raising operational concerns and prompting renewed scrutiny of its due diligence and risk assessment practices, particularly regarding third-party stablecoin issuers.