Tron Founder Justin Sun Provides Emergency Funding to Stabilize TUSD Amid Reserve Crisis
Tron founder Justin Sun stepped in to provide emergency funding for TrueUSD (TUSD) after its issuer, Techteryx, faced a liquidity crisis due to nearly half a billion dollars in reserves being tied up in illiquid investments. The financial hole, estimated at $456 million, emerged after TUSD issuer Techteryx struggled to redeem its investments, raising concerns about the stablecoin’s liquidity. Despite publicly distancing himself from TrueUSD and claiming he was acting only as an advisor, Sun stepped in to provide critical financial support when the crisis unfolded.
TrueUSD Faces Liquidity Crisis as $456M Becomes Inaccessible
Court documents reveal that Techteryx’s reserves had been tied up in investments that it could not easily liquidate, particularly loans to resource development projects in emerging markets. The situation left the issuer unable to access significant portions of its funds, prompting an urgent need for liquidity. The crisis stemmed from the mismanagement of TUSD’s reserves, which had been under the control of First Digital Trust (FDT), a Hong Kong-based fiduciary.
According to legal filings, FDT was directed to invest the reserves in the Aria Commodity Finance Fund (Aria CFF), a Cayman Islands-registered vehicle. However, court documents allege that $456 million was instead redirected to Aria Commodities DMCC, a separate entity based in Dubai, in an unauthorized transaction. Techteryx’s legal team described the situation as a “blatant misappropriation” of funds, claiming that FDT and Aria entities engaged in unauthorized transactions that depleted TrueUSD’s reserves. The crisis forced Techteryx to take full operational control of TUSD in mid-2023, severing ties with TrueCoin, the stablecoin’s previous operator. As redemption requests mounted, Sun intervened with emergency liquidity, structured as a loan, to prevent disruption for TUSD holders. Court filings indicate that Techteryx then quarantined 400 million TUSD to ensure retail users could continue redemptions without being affected by the reserve shortfall. “In the year since BUIDL’s launch, we’ve experienced significant growth in demand for tokenized real-world assets, reinforcing the value of bringing institutional-grade products on-chain,” Sun reportedly stated.
TUSD Controversy Escalates as First Digital Trust Denies Wrongdoing, FDUSD Depegs
As Justin Sun steps in to stabilize TrueUSD (TUSD), the fallout from the reserve crisis is spreading. First Digital Trust (FDT), the Hong Kong-based custodian managing reserves for both TUSD and FDUSD, has denied Sun’s claims of insolvency. CEO Vincent Chok stated that the firm acted solely on instructions from Techteryx, TUSD’s operator, and was not responsible for investment decisions. Meanwhile, Matthew Brittain of Aria Group also rejected allegations of mismanagement, stating that Techteryx was fully aware of the investment terms. However, Sun didn’t hold back, warning users on X that FDT was “effectively insolvent” and urging immediate action to protect assets. He called for regulatory intervention, saying Hong Kong’s financial reputation is at risk.
Amid the uncertainty, FDUSD, another stablecoin issued by First Digital, has shown signs of decoupling, with CoinGecko data showing it briefly dropped below $0.90 before recovering to $0.9883, down 2% in the past hour. On-chain data also shows Wintermute withdrawing $31.36 million in FDUSD from Binance, raising speculation about liquidity concerns. Meanwhile, Binance co-founder He Yi clarified that Sun’s lawsuit targets TUSD, not FDUSD, seeking to separate the two disputes. First Digital has responded strongly, calling Sun’s claims “completely false” and accusing him of orchestrating a smear campaign.
The firm insists the U.S. Treasury fully backs FDUSD reserves and announced plans to take legal action. Looking forward, First Digital has scheduled an AMA on X Spaces for April 3 to address investor concerns. The TrueUSD crisis displays the delicate balance between innovation and accountability. As market participants process the implications of reserve management failures, the industry faces difficult questions about transparency and trust. While emergency interventions may temporarily stabilize individual tokens, lasting solutions will require addressing the underlying structural vulnerabilities. The unfolding legal battles between Sun, Techteryx, and First Digital Trust will likely shape stablecoin governance practices for years to come, hopefully serving as a catalyst for more robust industry standards or regulatory frameworks that better protect users without stifling innovation.