Key takeout
Justin Sun said the original digital trust was insolvent and called on users to pull out funds and regulators to intervene. The warning comes hours after the filing revealed that TUSD was bailed out when the $456 million reserve was frozen in fraudulent investment.
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Justin Sun today issued a public warning, declaring that Hong Kong-based First Digital Trust (FDT) is insolvent and unable to meet redemption.
Protect your users and protect Hong Kong
First Digital Trust (FDT) is effectively insolvent and cannot meet client reimbursement. Users are highly encouraged to take immediate actions to secure their assets. There are important loopholes in both trust licensing processes…
– He was on April 2, 2025, Justin Sun (@justinsuntron)
In a post on X, the Tron founder urged users to secure their assets immediately and called on Hong Kong regulators and law enforcement to act promptly to prevent further damage.
“The original digital trust is effectively bankrupt and cannot meet client fund redemption,” Sun posted. “We strongly recommend that users take immediate action to secure their assets.”
He added that Hong Kong’s reputation as a global financial centre is at risk due to weak trust licensing and risk management monitoring.
This post comes hours after a court filing surfaced showing Sun previously remedied Techteryx’s TrueUSD (TUSD) Stablecoin.
According to a filing filed by US law firm Cahill Gordon & Reindel, the reserves had been repurposed from the intended destination (ARIA Commodity Finance Fund (ARIA CFF)) from the ARIA Commodity DMCC, an independent Dubai-based entity.
At the time, First Digital Trust was the trustee manager of TUSD’s reserves, which was said to have facilitated communication.
The plaintiffs in the case described the transaction as misappropriation and misrepresentation. FDT CEO Vincent Chok denied the fraud and said his company acted on Techteryx’s direction and raised concerns about KYC issues related to Stablecoin publishers.
According to X’s Zoomer Fied, the fallout from Sun’s post was soon there. FDUSD, a stablecoin issued by First Digital, has dropped by 5% from PEG, eliminating approximately $130 million in market capitalization.
At the time of the press, FDUSD had recovered to $0.98, but it was below $1, raising concerns about further drawdown and stability risks.
Sun’s warnings have increased pressure for Hong Kong regulators to respond. He is scheduled to hold a press conference on X on April 3rd, and will address further issues.
First Digital Trust has denied Justin San’s bankruptcy claim, saying the dispute relates to TUSD and not FDUSD. The company claimed that FDUSD remains fully solvent and supports 1:1 by the US Treasury bill and is transparently listed in its proof report.
“FDUSD, which supports all dollars, is safe, secure and explained,” the spokesman said it had rejected Sun’s post as a coordinated smear campaign targeting competitors.
The first digital added that it intends to pursue legal action to protect its reputation. The company plans to publicly address the issue by keeping the AMA in X space at 4pm on Thursday, April 3rd.
This article has been updated to include responses from First Digital Trust.
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