TL;DR
- FDUSD dropped to $0.87 after false rumors about its issuer, First Digital Trust, being insolvent, but quickly recovered its peg.
- Wintermute purchased over $31 million in FDUSD at discounted prices and later redeemed them at full value, securing significant profits.
- Binance continues to support FDUSD with a 111% reserve ratio, reinforcing its crucial role in maintaining market liquidity across key trading pairs.
After a sudden drop triggered by baseless rumors, the stablecoin FDUSD has regained its peg to the US dollar, now trading close to $0.99. This incident, which caused a brief wave of concern among Binance users, tested the stability of one of the most influential assets in the world’s largest crypto exchange.
The chaos began with a social media post from TRON founder Justin Sun, who claimed that First Digital Trust (FDT), the issuer behind FDUSD, was insolvent. Although FDT immediately denied the allegation and announced potential legal action against Sun, the market had already reacted, sending FDUSD plummeting to as low as $0.87.
A Window for the Fastest Players
During this moment of uncertainty, the market maker firm Wintermute stepped in, purchasing over $31 million in FDUSD at prices around $0.90. They later sent those tokens to FDT’s wallets to redeem them for actual US dollars, capitalizing on the opportunity to generate up to $3 million in profit. This move shows how institutional players can benefit from short-term volatility, while the underlying system proves resilient.
Binance also responded swiftly and decisively. The exchange reported that FDUSD is overcollateralized, with reserves covering 111.07% of user claims. This assurance calmed fears and helped FDUSD return to its dollar peg within hours, reinforcing user trust in both the stablecoin and Binance’s infrastructure.
FDUSD: A Core Pillar of Binance Liquidity
FDUSD is not just any stablecoin. With a circulating supply of 2.4 billion and daily trading volume exceeding $7.16 billion, it plays a critical role in trading pairs like BTC/FDUSD, BNB, SOL, and DOGE. While Binance has started phasing it out from launchpool programs, FDUSD remains a powerful engine of liquidity during market rallies and a key bridge between stablecoins like USDT.
Despite criticism over its centralized nature, FDUSD has shown remarkable resilience, avoiding any long-lasting panic or sustained loss of value. Instead of weakening the crypto ecosystem, this incident highlights its maturity: the systems react, responsible players step in, and opportunities arise for those who understand how the market functions.
With every shakeup, crypto grows stronger, and this time, FDUSD didn’t just survive. It came out stronger than before.
