Binance has confirmed the integrity of FDUSD’s reserve attestation for February, following concerns over a temporary de-pegging incident.
In a recent update, Binance announced it conducted a thorough review of First Digital USD’s (FDUSD) reserve data, both after the February attestation report and again recently to verify its accuracy.
According to an audit published on March 1, FDUSD holds $2.05 billion in reserves, conducted by Prescient Assurance. These reserves, maintained in fixed deposits and U.S. Treasuries, exceed the circulating supply of the stablecoin, ensuring a 1:1 redemption with USD.
This update follows accusations from a notable figure in the crypto space, leading to a brief 5% drop in FDUSD after allegations of insolvency against its issuer, First Digital Trust. The individual called for regulatory measures and urged investors to secure their assets.
This situation led to panic selling, causing FDUSD’s price to fall to approximately $0.87 before it began recovering. In response, First Digital Trust refuted the insolvency claims, stating the stablecoin is fully backed and accusing the accuser of spreading misinformation.
First Digital Trust has clarified that the issue at hand is not related to FDUSD, but is instead connected to a dispute with another stablecoin it manages. The issuer has also hinted at possible legal action against the accuser for defamation.
With Binance holding around 94% of FDUSD’s supply, this situation has raised concerns about the exchange’s vulnerability. Analysts are now cautioning about the risks of relying heavily on a single stablecoin for trading purposes.
As of now, FDUSD appears to have stabilized, trading at approximately $0.99 despite recent market fluctuations. Binance plans to conduct another review following the upcoming attestation report in two weeks and remains committed to monitoring FDUSD’s stability closely.
