Justin Sun recently tweeted that FDT, the company behind the FDUSD stablecoin, is bankrupt.

This caused FDUSD to drop sharply to $0.82 before making a slight recovery.

Binance holds $1.6 billion worth of FDUSD. For context, Binance and Justin Sun have a tense relationship.

Back during the SUI launchpool, Justin Sun deposited millions to farm SUI, but Binance blocked his attempt. That moment made it clear the two are not allies.

This situation shows how even stablecoins can be vulnerable when targeted by a powerful figure like Justin Sun.

So what should you do?

• Avoid keeping all your funds in one stablecoin • Consider spreading your assets across USDC, USDT, or others

Stay sharp, chads. This market is full of scam and volatility.

Binance just confirmed that $FDUSD is fully backed up 1:1, while a few hours, it depegged to a bottom of $0.87.

How so?

The explanation for the incident is: 

The recent drop in FDUSD is likely triggered by Justin Sun's claim that the issuing company is bankrupt and cannot back the stablecoin 1:1 with real assets. FDUSD is supposed to be backed by real assets like US Treasury bonds, and an external auditor verifies this monthly. Currently, FDUSD's market cap is $2.3 billion, but it only has $1.8 billion in assets. Unless the excess is burned to match the actual reserves, the price may not return to $1. This raises concerns about trust and transparency in stablecoin backing systems.

By the way, this event could happen to any of the other stablecoin at any given point in the future. As a crypto investor/ trader, you need to accept and mitigate this risk.