The cryptocurrency world is witnessing a heated dispute as First Digital (FDT) has issued a formal statement responding to the allegations made by crypto mogul Sun Yuchen regarding the management of its stablecoin reserves. FDT strongly rejected all claims, labeling them as "baseless" and "factually incorrect," and announced that it is seeking legal assistance to defend its reputation.

The Controversy:

• Sun Yuchen’s Press Conference:
• During a press conference, Sun Yuchen accused FDT of mismanaging funds and engaging in improper practices. He claimed that the company was involved in misallocation of funds and irregular operations, sparking widespread controversy in the crypto industry.
• First Digital's Rebuttal:
• FDT responded promptly, stating that Sun Yuchen’s accusations were reckless and unfounded. They emphasized that the company has never participated in any coordinated conspiracy or misappropriation of funds.
• FDT clarified that its role is strictly neutral, acting solely as a third-party intermediary, executing transactions based on written instructions from Techtyeryx or its authorized representatives. They emphasized that they are not responsible for reviewing the investments themselves and have maintained traceable records for all asset operations, complying fully with regulations.

Key Points from FDT’s Response:

• AML/KYC Issues:
• FDT mentioned that Techtyeryx, the company involved in the transactions, had faced regulatory challenges regarding Anti-Money Laundering (AML) and Know Your Customer (KYC) compliance. Specifically, the ARIA (likely a regulatory body) raised concerns about fund redemption requests from Techtyeryx, asking for detailed beneficiary information. However, Techtyeryx had failed to comply with these requirements.
• Responsibility Shift:
• FDT accused Techtyeryx and Sun Yuchen of attempting to shift responsibility for their own poor management decisions onto FDT. FDT argued that both parties had full decision-making authority over choosing secure and conservative investment strategies but instead opted for high-risk options, which they considered negligent or a deliberate assumption of risk. As a result, FDT insisted that any failure should be attributed to Techtyeryx and Sun Yuchen, not FDT.

Disputing Bankruptcy Claims:

• Allegations of Bankruptcy:
• In response to rumors spread by Sun Yuchen and Techtyeryx that FDT is facing bankruptcy, the company firmly denied these claims. They characterized the accusations as deliberate attempts to damage their reputation.
• FDT reiterated that its stablecoin FDUSD is fully backed 1:1 by cash and equivalent assets. The company also pointed out that all reserve assets’ ISIN numbers and certification reports have been publicly disclosed and are available for verification.

Next Steps: Legal Action:

• FDT Seeking Legal Recourse:
• FDT concluded their statement by announcing that they are seeking legal assistance and are prepared to take legal action to protect their reputation and rights. They reassured clients that they are processing all redemption requests and maintaining their full payment capability.

Conclusion:

• The ongoing conflict between First Digital and Sun Yuchen has put the company under scrutiny, but FDT continues to maintain its position that they have acted in full compliance with regulations and have not engaged in any improper actions. With legal action on the horizon, it seems this dispute is far from over.
• As the situation develops, it could have far-reaching consequences for the companies involved and the broader cryptocurrency market, particularly in the area of stablecoin management and regulatory oversight.