Tron (TRX) founder Justin Sun has accused First Digital Trust (FDT), the issuer behind the FDUSD stablecoin, of orchestrating a large-scale fraud involving the misuse of reserve assets backing rival stablecoin TUSD.
In a detailed statement posted on social media, Sun compared FDT’s alleged misconduct to FTX’s infamous collapse, describing the FDT scandal as “significantly worse.”
According to Sun, FDT withdrew $456 million from TUSD’s custody reserves without notifying customers and then allocated the funds as an unsecured loan to a “suspicious third party” based in Dubai. Sun alleges that the money trail indicates laundering activities and a coordinated embezzlement effort, which he says rises to the level of a crime.
While FTX founder Sam Bankman-Fried (SBF) was recently convicted for his role in the misuse of customer funds, Sun claims that FDT’s actions are even more egregious. Noting that SBF at least used tokens like FTT and SRM as collateral for loans and invested in notable firms like Robinhood and artificial intelligence startup Anthropic, Sun alleged that FDT moved funds into fraudulent assets without any transparency or security.
Sun also highlighted differences in the response to the crisis: While SBF cooperated with authorities and legal teams to recover user assets, FDT’s leadership remained silent and indifferent, according to Sun.
Sun warned that the unfolding situation threatened to damage Hong Kong’s reputation as a financial centre. He called for urgent regulatory intervention, echoing the decisive steps taken by US authorities during the FTX crash.
“Hong Kong must act quickly, decisively and effectively, like its US counterparts. We cannot allow fraudsters to continue their pyramid schemes against the people,” he said.
Sun’s statement also revealed that he was approached for funding support during both the FTX and FDT crises. While he declined to bail out FTX due to the scale of its collapse, he said he was “forced to support user losses” in the FDT case due to his role as an advisor to Techteryx, a company associated with the TUSD ecosystem.
Although the FDUSD price has not completely stabilized at the time of writing, it is trading at $0.9953, close to $1.
*This is not investment advice.
