Justin Sun Accuses Stablecoin Issuer of Embezzling $500 Million
TRON founder Justin Sun has intensified his allegations against First Digital Trust (FDT), accusing the issuer of the FDUSD stablecoin of embezzling $500 million from client funds.
In a recent post on social media platform X, Sun compared FDT’s actions to those of the collapsed FTX exchange, but claimed that FDT’s misconduct is “ten times worse.”
He argued that unlike FTX, which at least structured its misuse of funds as pledged loans, FDT allegedly siphoned off nearly $456 million from TUSD custodial funds without authorization, channeling it to a questionable third-party company in Dubai with no collateral backing.
Sun criticized FDT’s practices, stating that while FTX founder Sam Bankman-Fried (SBF) misused client assets, a portion of those funds went into legitimate investments, including companies like Robinhood and Anthropic.
In contrast, Sun claims FDT redirected assets purely for private gain, lacking any meaningful investment strategy. He also condemned FDT CEO Vincent Chok Zhuo for allegedly downplaying the situation and not taking responsibility, contrasting this with SBF’s eventual cooperation with authorities.
Sun urged Hong Kong regulators to take decisive action similar to the US response during the FTX collapse, warning that the region’s reputation as a financial center could be at stake. To pressure for accountability, Sun has launched a $50 million bounty program to encourage whistleblowers and has met with Hong Kong lawmaker Johnny Wu to discuss potential regulatory measures.
According to Sun, swift action is necessary to protect the public and maintain trust in the financial ecosystem, as he continues to rally for more scrutiny on FDT’s activities.
Alexander Stefanov
Reporter at Coindoo
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over 8 years of experience covering the crypto, blockchain and fintech industries, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics.
