Hong Kong court filings show Justin Sun bailed out TUSD stablecoin issuer after losing $450M reserves

According to a Hong Kong court filings, Justin Sun stepped in to bail out Techteryx’s TrueUSD (TUSD) stablecoin after it saw nearly half a billion dollars of its reserves rendered illiquid.

The issue started after Techteryx acquired TrueUSD from TrueCoin in December 2020. After the acquisition, Techteryx appointed First Digital Trust (FDT), a Hong Kong-based fiduciary, to manage its stablecoin reserves with specific instructions that FDT has now been accused of not following.

When did Justin Sun step in to help?

According to court documents compiled by the U.S. law firm Cahill Gordon & Reindel, FDT was instructed to invest the stablecoin reserves in the Aria Commodity Finance Fund (Aria CFF), a Cayman Islands-registered vehicle.

However, court filings claim that about $456 million was improperly diverted into Aria Commodities DMCC, a separate, unauthorized entity based in Dubai.

Court documents identify Matthew Brittain as the one who calls the shots in Aria Commodity Finance Fund (Aria CFF) through Aria Capital Management Ltd and Cecilia Brittain as the sole shareholder of the separately owned Aria Commodities DMCC.

Court documents say that Cecilia and Matthew are married. Matthew says ARIA DMCC engages in trade finance, asset development, and commodity trading, while ARIA CFF finances commodity traders, including ARIA DMCC and third parties.

Attestations produced by Moore CPA Limited highlight how FDT has managed $501 million of TrueUSD’s reserves by November 2024.

Meanwhile, Hong Kong court filings also say Vincent Chok, First Digital’s CEO, allegedly moved $15.5 million in undisclosed commissions to an entity called “Glass Door” and, in separate transactions, structured approximately $15 million in unauthorized trade finance loans from FDT to Aria DMCC.

Chim would later retroactively mischaracterize them as legitimate fund investments in what the plaintiffs have described as fraudulent misrepresentation and misappropriation, especially since they were made without the “knowledge, authorization or approval of the Plaintiff.”

Aria DMCC invested funds it got in endeavors it described as relatively illiquid, but when Techteryx tried to redeem its investments from Aria CFF between mid-2022 and early 2023, it ran into a wall, receiving barely any funds back as Aria entities defaulted on payments.

Techteryx eventually took full operational control of TUSD in July 2023, after which it terminated TrueCoin’s involvement. As part of a transitional period after the December 2020 sale, TrueCoin kept running the day-to-day operations of TUSD.

Court filings claim that around this time, Justin Sun stepped in to provide emergency liquidity support, which was structured as a loan.

Afterwards, the Techteryx team quarantined 400 million TUSD to ensure retail redemptions could continue, and token holders wouldn’t be affected despite the stablecoin issuer’s bankruptcy.

After news of Techteryx going after FDT was reported by Coindesk, Justin Sun took to X, formerly Twitter, with a post that contained a warning.

“First Digital Trust (FDT) is effectively insolvent and unable to fulfil client fund redemptions. I strongly recommend that users take immediate action to secure their assets,” Sun wrote.

He pointed out that there are significant loopholes in Hong Kong’s trust licensing process and the financial system’s internal risk management.

First Digital Trust (FDT) is effectively insolvent and unable to fulfill client fund redemptions. I strongly recommend that users take immediate action to secure their assets. There are significant loopholes in both the trust licensing process in Hong Kong and the internal risk…

— H.E. Justin Sun 🍌 (@justinsuntron) April 2, 2025

“I urge regulators and law enforcement to take swift action to address these issues and prevent further major losses,” Sun added. “Hong Kong’s reputation as a global financial center is at stake, and similar financial fraud incidents must never happen again.”

He urged those who need more details to stay tuned for the press conference that will be held tomorrow, April 3, at 2 PM HKT.

How First Digital responded to Techteryx’s accusations

Speaking to CoinDesk about the subject, First Digital’s Chok, specifically denied any wrongdoing or participation in fraudulent schemes.

According to Chok, First Digital Trust acted strictly as a fiduciary intermediary and executed transactions exactly as the instructions provided by Techteryx and its representatives demanded.

He asserted that the company has no responsibility to independently evaluate or advise on these investment decisions.

“It is our understanding that one of the main blockers voiced by ARIA for early redemptions of funds (as requested by Techteryx) has been their AML/KYC concerns regarding the deal between TrueCoin and Techteryx and the true identity of the ultimate beneficial owner of Techteryx,” Chok explained in an email, adding that he believes nobody named in the case considers Aria illiquid.

“We have not yet had the opportunity to fully defend ourselves,” Chok wrote in his email to CoinDesk. “We are fully committed to clarifying these matters in due course as the legal and arbitration process continues.”

Aria Group’s Matthew Brittain is miffed about the whole affair and has said that he “completely rejects Techteryx’s claims against ARIA DMCC and any related entities,” highlighting how false allegations were made in the court proceedings.

As far as Brittain is concerned, Techteryx was fully aware of term commitments, which were reportedly outlined in contracts that subscribers agreed to when investing in ARIA CFF and are clearly set out in the Offering Memorandum.

Brittain also echoed Chok’s sentiments about Techteryx’s beneficial ownership. The Hong Kong writ has identified Li Jinmei as the ultimate beneficial owner of Techteryx, but Brittan said the subscriber has yet to resolve the ownership concerns.

Jinmei, the current owner, is not to be confused with Jennifer Yiyang – the previous ultimate beneficial owner of the company – even though there have been media reports to the contrary.

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