TechFlow news, April 4 — Justin Sun posted on social media stating that First Digital Trust (FDT) has become insolvent—that is, its total liabilities exceed its total assets, placing it effectively in a state of financial bankruptcy. As such, under international banking regulations, financial institutions must meet strict capital adequacy requirements, or otherwise face revocation of their banking licenses.
Yet shockingly, FDT has been insolvent not just once, but for three consecutive years—its net assets reached negative HK$100 million by the end of 2024. This figure does not even account for the massive losses caused by large-scale misappropriation of user assets. Strangely, while we are discussing this, the company continues to publicly raise billions in funding. The real question Hong Kong regulators and law enforcement must answer is: how could such a situation occur under their supervision? The mere fact that FDT remains operational is itself a profound irony toward Hong Kong's rule of law.
