Justin Sun, founder of TRON, has reported alleged embezzlement of nearly $500 million by First Digital Trust in Hong Kong.
Justin Sun's Accusations
Justin Sun reported a significant embezzlement case involving First Digital Trust (FDT). He met with Legislative Council member Wu Jiezhuang, who acknowledged the international implications and emphasized reviewing Hong Kong’s regulatory frameworks. Sun expressed confidence in recovering the alleged stolen $500 million.
First Digital Trust's Response and Consequences
FDT, a stablecoin issuer based in Hong Kong, denied the allegations, claiming reserves are backed by U.S. Treasury bonds. Despite this, the incident impacted the stablecoin FDUSD, which temporarily depegged, losing market value.
Potential Regulatory Implications in Hong Kong
Market observers noted a loss of confidence, while Wu Jiezhuang shared concerns about investor sentiment. He emphasized closing regulatory gaps. Lawmaker Johnny Ng reassured investors about the strength of Hong Kong’s regulations. Coincu research suggests the FDT incident could accelerate regulatory actions in Hong Kong.
Justin Sun's embezzlement claims against First Digital Trust raise questions about the reliability of crypto financial systems and the need for improved regulation in Hong Kong.
