The well-known stablecoin TrueUSD (TUSD) was recently exposed for having nearly $456 million in its reserve funds become difficult to access due to investment errors, directly impacting its liquidity. Ultimately, Justin Sun, a prominent figure in the crypto world, stepped in to rescue the situation. This financial storm involved a Hong Kong trust company, Dubai traders, offshore funds, and a series of unauthorized investment operations, with a plot as complex as a financial thriller.

Perhaps because this case was detailed by CoinDesk, Justin Sun, who took over TrueUSD (TUSD), suddenly revealed news about the fifth-largest stablecoin FDUSD's issuer being insolvent, as the issuer also had connections to TrueUSD reserves.

(Justin Sun's account claims First Digital Trust is insolvent, with FDUSD significantly depegging to 0.88)

Techteryx Unable to Withdraw Funds, Justin Sun Provides Emergency Financial Assistance

From mid-2022 to early 2023, Techteryx attempted to redeem funds from Aria CFF but could hardly receive any money. Aria delayed payments and failed to fulfill redemption requests, causing TrueUSD to face a reserve depletion crisis.

According to documents submitted to the US Department of Justice, Justin Sun stepped in to provide an emergency loan, injecting liquidity into TUSD. Techteryx subsequently isolated 400 million TUSD to ensure users could still redeem, avoiding market panic.

FDT and Aria Both Refute: We Are Just "Following Instructions"

In response to CoinDesk, FDT CEO Chok denied any improper operations, emphasizing that the company was merely executing fund allocation based on Techteryx's instructions and was not responsible for judging or recommending investment targets.

He also stated that Aria refused early fund redemption due to doubts about Techteryx's ultimate beneficial owner.

Similarly, Aria's Matthew Brittain denied all allegations, believing the legal documents were full of misstatements. He claimed Techteryx was explicitly aware of the "time limitations" on funds, which were disclosed in the fund's prospectus.

TUSD's Previous Owner TrueCoin Also Sanctioned by SEC, Stablecoin Credibility Further Damaged

To make matters worse, in September 2024, the US Securities and Exchange Commission (SEC) reached a settlement with TrueCoin and its former brand TrustToken. The SEC accused them of falsely claiming TrueUSD was 100% backed by US dollar reserves, when in fact, they invested part of the funds in 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 fraud and unregistered securities issuance allegations.

Banking Partner Prime Trust in Trouble, TUSD Faces Multiple Trust Crises

TUSD's fate is not only dragged down by investment disputes but also by unstable financial infrastructure. Prime Trust, which previously handled fiat deposits and withdrawals for TUSD, was taken over by Nevada regulatory authorities in mid-2023.

According to court documents, Prime Trust had only about $3 million in available assets at the time, yet needed to meet approximately $85 million in customer fund obligations.

This double trust crisis severely challenges TUSD's stability.

The "Unstable Truth" of Stablecoins: From Decentralization Slogans to High Dependence on Key Figures

TUSD, which should have been stable, gradually revealed that behind its seemingly "distributed" decentralized product lies a high dependence on individual decisions and opaque institutional collaborations. When fund reserves were trapped in Dubai and regulatory reviews followed, a crypto big shot's financial transfusion became the last line of defense.

The incident once again sparked widespread concern about stablecoin reserve transparency, investment strategies, and regulatory risks. For users, a seemingly safe "stablecoin" might be hiding undetectable financial landmines.