On April 2, the stablecoin FDUSD briefly dropped in value after Justin Sun, the founder of Tron
According to Sun, First Digital had moved more than $450 million of customer funds to a company in Dubai without permission. He also suggested that this transfer might have broken financial rules in Hong Kong.
Sun claimed that the company was not being honest about its financial position. His statement raised questions about whether FDUSD was fully backed by real assets, as promised by First Digital.
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Despite these claims, First Digital says it is operating as usual. Since the controversy began, data shows the company has processed nearly $26 million in redemptions. This means that users were able to exchange their FDUSD for US dollars without delay.
When this happens, the same amount of FDUSD is destroyed, or “burned”, on the blockchain. This helps keep the supply in line with the actual reserves.
In an April 3 post on X, First Digital said, “We continue to process redemptions smoothly, demonstrating the fortitude of FDUSD”. The company also made it clear that the stablecoin remains fully backed and can be exchanged at any time.
Furthermore, it responded to Sun’s remarks by calling him “factually incorrect” and pointing to what it described as issues within Sun’s own network.
Meanwhile, a new meme coin called Wolf (WOLF) briefly hit a $42 million market cap before crashing by over 99% in just two days. How? Read the full story.
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