Justin Sun First Digital Trust scandal sees $500M allegedly moved to Dubai

Key Points

• Justin Sun First Digital Trust scandal sees $500M allegedly moved to Dubai
  • Named individuals accused of facilitating the transfers
  • FDT denies claims and files a defamation lawsuit
  • FDUSD stablecoin market cap plunges over $1 billion

Tron founder Justin Sun has leveled serious allegations against First Digital Trust (FDT), claiming the company misused $500 million in customer funds by funneling them into banks across Dubai.

On May 3, Sun took to X (formerly Twitter) to announce that FDT had distributed the massive sum among several major banks, including Mashreq Bank, Emirates NBD, Abu Dhabi Islamic Bank (ADIB), and EFG.

🚨 Latest Update on the First Digital Trust (FDT) & ARIA Scam Case

Congratulations to https://t.co/6EgFWCyeuW on its official launch—a crucial step towards enhancing transparency in tracking Web3 scams.

The more than 500 million USD funds from the First Digital Trust & ARIA… pic.twitter.com/hz1GW9QzPk

— H.E. Justin Sun 🍌 (@justinsuntron) May 3, 2025

He also named key individuals allegedly involved in authorizing the transfers. Among them were Christian Alexander Boehnke, De Lorraine Elbouef, FDT CEO Vincent Chok, Yai Sukonthabhund, Matthew William Brittain, and Cecilia Teresa Brittain.

According to Sun, these executives held positions of authority that allowed them to divert customer assets without consent.

“Dubai must not become a haven for fraud and money laundering. Banks must review, freeze suspicious inflows, and report them,” Sun urged in his post.

This latest claim intensifies the already growing rift between Justin Sun and the Hong Kong-based FDT.

Alleged Flow of First Digital Trust’s Misappropriated Fund. Source: Justin Sun – Techtoken

Last month, Sun raised insolvency claims against multiple crypto custodians, further amplifying the scrutiny on such firms. (Related: Justin Sun insolvency claim)

He compared the alleged misconduct to the infamous FTX scandal, stating it was “far worse” since it lacked loan collateral or user approval structures.

FDT Denies Allegations as FDUSD Market Cap Tumbles

First Digital Trust has firmly rejected all allegations and responded by filing a defamation lawsuit against Sun.

As regulators in Hong Kong begin reviewing the actions of local trust companies, the controversy has already had a significant financial impact.

BREAKING

The SEC has just halted its fraud prosecution of Justin Sun, a Chinese national who has put more than $50 million in Trump’s pocket since November through the purchase of crypto tokens from a Trump-backed company, World Liberty Financial. pic.twitter.com/KzPqC6Frht

— Judd Legum (@JuddLegum) February 28, 2025

The market capitalization of FDT’s FDUSD stablecoin has plummeted from over $2.5 billion to approximately $1.4 billion since the dispute began.

In response to the scandal, Sun has launched a $50 million bounty program to encourage further investigation and accountability. He also rolled out a dedicated website aimed at exposing the alleged misuse of funds.

While FDT maintains its innocence, Sun is calling for Dubai’s banks and regulators to take swift action. He has demanded internal audits, freezing of suspicious accounts, and full public disclosure of any irregularities.

First Digital Trust’s FDUSD Stablecoin Market Cap. Source: Techtoken

With Dubai positioning itself as a global crypto hub, the outcome of this high-stakes conflict could have lasting effects on the region’s financial reputation.

Growing Concerns Over Crypto Fraud and Regulatory Gaps

The Justin Sun First Digital Trust $500 million controversy highlights broader challenges facing the crypto industry, especially around custodial services and asset security.

Recent events have underscored these concerns:

• Crypto phishing scams surged in April 2025, leading to millions in losses for investors. (Read more: Crypto phishing scams April 2025)

• Regulatory upgrades like the BNB Chain Lorentz Hard Fork, which recently improved block speeds to 1.5 seconds, reflect efforts to enhance blockchain efficiency and security. (Details: BNB Chain Lorentz Hard Fork)

• Ethereum’s ongoing simplification efforts are also aimed at reducing complexities and minimizing risks. (Update: Ethereum simplification)

Additionally, the reserves transparency at major exchanges like Binance has come under increasing public attention, a sign that the market is demanding higher accountability. (Insight: Binance Bitcoin reserves)

As the industry navigates these turbulent waters, incidents like the FDT case serve as a wake-up call for regulators, investors, and institutions alike.