Why is there anger towards FDUSD? After nearly 500 million in TUSD reserves hit a bottleneck, cash is running out. Sun Yuchen rushed to the rescue, raising many suspicions.

The well-known stablecoin TrueUSD (TUSD) has recently been revealed to have nearly 456 million USD in its reserve funds rendered inaccessible due to investment errors, directly impacting its Liquidity. Ultimately, it was saved by a prominent figure in the crypto world, Justin Sun, who barely stabilized the situation. This financial storm involves a Hong Kong trust company, a Dubai trader, offshore funds, and a series of unauthorized investment operations, with a plot as complex as a financial thriller.

Perhaps it is also because this case was detailed by CoinDesk that Sun Yuchen, who recently accepted TrueUSD (TUSD), suddenly revealed news about the fifth largest stablecoin FDUSD's issuer being insolvent, as this issuer is also linked to the reserves of TrueUSD.

( Sun Yuchen's account claims First Digital Trust is insolvent, FDUSD has significantly decoupled to 0.88)

The "reserve operation black hole" after Techteryx acquired TrueUSD

Techteryx acquired TrueUSD from TrueCoin in December 2020 and entrusted the management of the reserve funds to First Digital Trust (FDT) in Hong Kong. What was supposed to be an asset for value preservation was instead redirected to the Aria Commodity Finance Fund (Aria CFF) established in the Cayman Islands.

However, legal documents provided by the U.S. law firm Cahill Gordon & Reindel reveal that as much as $456 million was mistakenly transferred to another unauthorized entity based in Dubai, Aria Commodities DMCC.

Dubai Company "Funds Disappeared": The Aria Dual-System Operated by a Couple

According to court documents, Aria CFF is controlled by Matthew Brittain and managed through Aria Capital Management Ltd, while Aria Commodities DMCC in Dubai is solely owned by his wife, Cecilia Brittain.

Although the two companies appear to operate separately on the surface, Matthew's email signature comes from Dubai, indicating that their actual operations may overlap. In an email to CoinDesk, Matthew stated that Aria CFF is responsible for financing commodity traders, including Aria DMCC, and the two are closely related.

From investment fund to "fake loans"? FDT CEO accused of manipulating suspicious transactions

According to Hong Kong court documents, First Digital CEO Vincent Chok was instructed to pay an undisclosed commission of $15.5 million to an entity named "Glass Door" and also mispackaged $456 million in funds as trade finance loans. These amounts were later reclassified as "fund investments," which the plaintiffs believe constitutes fraudulent misrepresentation and misappropriation of funds.

The lawsuit states: "These remittances are completely unauthorized misappropriation and money laundering activities."

Techteryx is unable to withdraw funds, and Sun Yat-sen has stepped in to provide emergency financial assistance.

From mid-2022 to early 2023, Techteryx attempted to redeem funds from Aria CFF, but was unable to receive the money. Aria was in default of payment and could not fulfill the redemption requests, putting TrueUSD in a reserve depletion crisis.

According to the complaint submitted to the U.S. Department of Justice, Sun Yuchen provided an emergency loan at this time to inject liquidity into TUSD. Techteryx subsequently isolated 400 million TUSD to ensure that users could still redeem, avoiding market panic.

FDT and Aria both rebutted: We are just "acting on instructions".

In response to CoinDesk, FDT CEO Chok denied any wrongdoing, emphasizing that the company was merely following the instructions provided by Techteryx for fund allocation, and is not responsible for assessing or recommending investment targets.

He also stated that Aria refused to redeem the funds early due to doubts about the identity of the ultimate beneficiary of Techteryx.

Similarly, Matthew Brittain of Aria also denies all allegations, believing that these legal documents are full of misstatements. He claims that Techteryx was clearly aware that the funds had "time limits," and this information was disclosed in the fund's prospectus.

TUSD's predecessor TrueCoin was also penalized by the SEC, further undermining the trust in stablecoins.

To add insult to injury, in September 2024, the U.S. Securities and Exchange Commission (SEC) reached a settlement with TrueCoin and its former brand, TrustToken. The SEC accused them of falsely claiming that TrueUSD is backed by 100% dollar reserves, when in fact putting some of their money into high-risk offshore funds.

Although neither party admitted wrongdoing, TrueCoin and TrustToken agreed to pay over $500,000 in fines and illegal gains to settle allegations of fraud and unregistered securities issuance.

Bank partner Prime Trust is in trouble, TUSD is facing multiple trust crises.

The fate of TUSD is not only dragged down by investment controversies, but its financial infrastructure is also unstable. Prime Trust, which used to handle fiat deposits and withdrawals for TUSD, was taken over by regulators in Nevada in mid-2023.

According to court documents, Prime Trust had only about 3 million USD in available assets at the time, but was obligated to handle approximately 85 million USD in customer funds.

This dual trust crisis has put the stability of TUSD at risk.

The "Unstable Truth" of stablecoins: From the slogan of decentralization to heavy reliance on key figures.

The TUSD that was supposed to be stable gradually reveals that its seemingly "decentralized" product is actually highly dependent on individual decisions and opaque institutional collaborations. When the capital reserves are trapped in Dubai and regulatory reviews follow one after another, a major player in the crypto world becomes the last line of defense for funding.

The incident has once again sparked widespread concern about the transparency of stablecoin reserves, investment strategies, and regulatory risks. For users, a seemingly safe "stablecoin" may hide financial landmines that are difficult to detect.

This article angrily reveals the reason for FDUSD? TUSD's nearly 500 million reserves are "stuck", cash is in urgent need, Sun Yuchen urgently steps in, and there are many doubts. First appeared in Chain News ABMedia.