FDUSD Stablecoin Fully Backed Despite Fraud Allegations, Price Stabilizes at $0.99
First Digital Trust has released a new attestation report confirming that the FDUSD stablecoin is fully backed by reserves. The report, published on April 14, reveals that FDUSD’s total supply of 2.58 billion tokens is supported by $1.74 billion in U.S. Treasury bills and $603 million in overnight repurchase agreements. Additional assets are held in fixed deposits across various jurisdictions, with all reserves kept in bankruptcy-remote accounts separate from the company’s own funds. According to first digital trust, over $1 billion worth of FDUSD has been redeemed without any issues to date.
The attestation comes at a time when Tron founder Justin Sun has leveled fraud accusations against First Digital Trust. Sun alleges that the firm, along with partners including Aria DMCC, embezzled nearly $500 million in client assets. He claims that the funds were redirected to an unrelated account through a fraudulent address change and partially deposited into a Hong Kong account named “Glass Door.” Sun has met with lawmaker Johnny Wu to report the case and submitted related documents to regulators, describing the situation as a major financial fraud involving traditional finance and Web3 companies. He also hosted a live broadcast to discuss what he called irregularities in First Digital Trust’s handling of client assets.
First Digital Trust has vehemently denied all accusations and has filed a defamation lawsuit against Sun in Hong Kong’s High Court. The firm seeks to prevent further public statements from Sun and is requesting retractions and compensation. The company has reiterated its commitment to transparency by continuing to release independent attestation reports. It has also reaffirmed that FDUSD reserves remain fully backed and that customer redemptions have continued without any disruption.
Following the public allegations, FDUSD briefly lost its peg, falling to $0.87. However, the price has since stabilized and was trading at $0.99 at the time of the report. The stablecoin’s recovery followed the release of the attestation report and public reassurances from First Digital Trust. FDUSD is issued by FD121 Limited and overseen by First Digital Trust. It is available on Ethereum, BNB Chain, Solana, and sui blockchains. The company has stated its commitment to publishing regular attestations and working with independent auditors to ensure transparency.
The allegations and subsequent legal actions highlight the ongoing scrutiny and challenges faced by stablecoin issuers in maintaining trust and transparency. The situation underscores the importance of independent audits and regular attestations in reassuring users and investors about the stability and security of stablecoins. First Digital Trust’s response to the allegations, including the release of the attestation report and the defamation lawsuit, demonstrates its efforts to address the concerns and maintain the integrity of the FDUSD stablecoin.
