Hong Kong investigates trust companies amid Justin Sun’s claims against First Digital Trust

Sun meeting with Hong Kong Legislative Council members (Justin Sun on X)

In his public response, Lawmaker Wu noted that he had already met with some complainants and was fully aware of the issue. One of the complainants he met with was Sun, who had met with several members of the Hong Kong Legislative Council.

However, Wu added that there is nothing to worry about because the rule of law would prevail as regulators would do everything to protect investors and citizens.

He said:

Meanwhile, the lawmaker added that several fraud cases using trust companies have been reported to his office and the Anti-Fraud Alliance this year. He noted that the most recent case might present an opportunity to address the issue and discuss ways to improve the regulatory framework to prevent abuse by bad actors.

First Digital denies allegations, plans to sue Sun

While Sun continues to call for an investigation and warn people about holding FDUSD, the stablecoin issuer has released its own response to the allegations, which denies all allegations of fraud and misappropriation of funds.

The one-page rejoinder posted on X claimed that FDT was only an intermediary that acted on the instructions of Techtryx and its authorized representatives without any obligation to evaluate or advise on those instructions. The company noted that Sun and Techteryxs claims are only an attempt to shift blame and are completely false accusations.

It said:

The firm further reiterated that its FDUSD is completely solvent and Suns claim is only a malicious attack on a competitor. It added that it is also seeking a legal opinion on whether to sue Sun for the attack on its reputation.

So far, the public is buying the FDT version of the story, with FDUSD now regaining its peg after a flash crash that saw the stablecoin depeg. For one, many people believe that Sun has an ulterior motive for fighting the stablecoin wars, and he is not doing it simply to protect Hong Kong and its users.