Tron founder Justin Sun has filed a legal complaint against First Digital Trust (FDT), the issuer behind FDUSD, alleging that the company misappropriated nearly half a billion dollars belonging to its clients. He claims this constitutes a significant financial fraud impacting both traditional finance and Web3. He highlighted potential loopholes within the trust industry as a factor in this alleged breach. Sun, who has publicly discussed his concerns, shared information with Hong Kong legislator Johnny Wu, who then raised the matter in the Legislative Council. Sun’s accusations led to instability in FDUSD’s peg, temporarily causing its price to dip below $0.90 before recovering. FDT vehemently denies these allegations, claiming that they are false and part of a coordinated smear campaign aimed at damaging their reputation. The company insists that FDUSD remains fully backed on a 1:1 basis with cash and U.S. Treasury bills, further supported by Binance’s confirmation of the stablecoin’s reserves. A third-party audit conducted by Prescient Assurance showed that FDUSD had $2.05 billion in reserve as of March 1st, exceeding the amount currently circulating, ensuring a 1:1 redemption with USD. FDT has threatened legal action against Sun for spreading misinformation. Sun’s allegations have sparked further investigation into the case and triggered discussions regarding the legitimacy of trust industries within the cryptocurrency space.