First Digital responded firmly to Justin Sun’s accusations, stating, “This is a dispute with TUSD, not $FDUSD. First Digital is fully solvent—every dollar is backed by U.S. Treasury Bills, with ISIN numbers publicly detailed in our attestation report.”

First Digital Trust has publicly rejected insolvency and fraud allegations made by Tron founder Justin Sun, stressing that the dispute he initiated concerns the TUSD stablecoin and not its FDUSD stablecoin product. In a statement posted on X, the firm emphasized that FDUSD is fully backed, saying every token is backed 1:1 by U.S. Treasury bills, with specific ISIN identifiers disclosed in its regular attestation reports to demonstrate reserve quality and transparency. First Digital framed Sun’s claims as a “smear campaign” aimed at a competitor and said it intends to pursue legal action to defend its reputation. Sun has accused First Digital of being effectively insolvent and misappropriating hundreds of millions of dollars related to TUSD reserves, urging regulators and users to act, which in turn sparked broader market anxiety around FDUSD despite it not being the subject of the lawsuit. Following the accusations, FDUSD briefly depegged—trading as low as the high‑$0.80s—and major market makers such as Wintermute reportedly withdrew tens of millions of FDUSD from Binance, prompting Binance cofounder Yi He to clarify that FDUSD is separate from the TUSD dispute and to float the idea of an independent audit of FDUSD reserves. The episode highlights the fragility of confidence in stablecoins and how legal and reputational disputes around one product (TUSD) can quickly spill over to another (FDUSD), even when the issuer asserts full solvency and transparent backing.

✨ AI-generated background, compiled from web sources — not editorial content.

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• Justin Sun et al. - SEC.gov (sec.gov)
• Justin Sun's $500M Fraud Accusation and First Digital's Rebuttal (cryptoninjas.net)

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