The stablecoin FDUSD deviated from its dollar peg by approximately 12% following Justin Sun’s statements about the insolvency of First Digital Trust (FDT).

First Digital Trust is a Hong Kong-based fiduciary firm hired by Techteryx to manage the reserves of the TrueUSD stablecoin. According to CoinDesk, in 2023–2024, the project’s balance sheet showed a $456 million deficit linked to FDT’s activities.

Court documents indicate that the firm was supposed to invest reserve funds in the Aria Commodity Finance Fund (Aria CFF) in the Cayman Islands but instead redirected the money to Aria Commodities DMCC—an unauthorized fund registered in Dubai.

Matthew Britten, listed in the documents as the manager of Aria CFF, told reporters that the two funds are connected—DMCC handles trading, while CFF provides financing for transactions.

In 2022, Techteryx attempted to recover the funds, but the fund was able to return only a small portion. Sun then provided Techteryx with a loan to support token buybacks.

On April 2, in response to CoinDesk’s report, Sun tweeted that FDT was unable to guarantee the redemption of customer funds.

First Digital Trust (FDT) is effectively insolvent and unable to fulfill client fund redemptions. I strongly recommend that users take immediate action to secure their assets. There are significant loopholes in both the trust licensing process in Hong Kong and the internal risk…
— H.E. Justin Sun 🍌 (@justinsuntron) April 2, 2025

He advised users to withdraw their funds and urged regulators to address deficiencies in the licensing system and risk management.

His statement triggered a wave of sell-offs of First Digital Trust’s stablecoin, FDUSD, causing its price to temporarily drop to $0.88. At the time of writing, the chart had stabilized at $0.98.

Sun also promised to reveal more details at a press conference on April 3.

Reminder: In March, Justin Sun appeared on the cover of Forbes, driving TRX trading volumes above $500 million.