Binance announced that it will launch a new stablecoin First Digital USD (FDUSD) at 16:00 on July 26, and will open new spot trading pairs. As a big cake in the industry and an important asset type of Crypto, stablecoins have made a lot of news this year. Binance, the world's largest crypto trading platform, has its own stablecoin BUSD under regulation, USDC has also been abandoned, and TUSD has often been caught in turmoil. What is the origin of FDUSD this time?

About the publisher First Digital

The issuer of First Digital USD (FDUSD) is FD121 Limited (brand name First Digital Labs). Its parent company, First Digital Trust, is a qualified custody and trust company headquartered in Hong Kong. On June 1 this year, it officially announced the launch of a stablecoin pegged to the US dollar - FDUSD, which is regulated in Asia.

According to data, First Digital's earliest round of financing was in 2020. It has completed three rounds of financing, totaling US$25.15 million. Investors include Nogle and Kenetic Capital.

Data source: Qichacha

When First Digital launched FDUSD, it stated that as a company registered under the Hong Kong Trust Ordinance, they must hold all FDUSD reserves in separate accounts at regulated financial institutions in Asia, which will prevent FDUSD reserves from being mixed with other assets of First Digital Trust Limited.

It is worth noting that Binance founder CZ also posted a related tweet as soon as FDUSD was launched.

Public information shows that the CEO of First Digital is Vincent Chok. According to Linkedin information, in addition to being the CEO of First Digital, Vincent Chok has been the CEO of First Digital's parent company Legacy Trust Company Limited since 2015. First Digital's current COO Gunnar Jaerv has also previously served as the head of private label trusts and the head of the digital asset department at Legacy Trust Company Limited, working at the company for 7 years.

First Digital CEO Vincent Chok

Vincent Chok's resume, source: Linkedin

Checking Vincent Chok’s Twitter homepage, BlockBeats discovered that Vincent is also a BAYC holder, and immediately found the Ethereum address based on his NFT avatar: 0x39E298800356ca0b973A50bF34A977D2B01d4b5c.

Source: OpenSea

Source: DeBank

There are no other assets in the address except 2 NFTs and dozens of dollars of cryptocurrency.

White Paper Information

According to the white paper, FDUSD issued by First Digital is fully backed by 1:1 USD assets, and the underlying assets are held by First DigitalTrust Limited. Users can view the transparency report of FDUSD on the official website. At present, its official independent audit report and reserve account report for July 2023 have been released.

FDUSD is issued to provide users with a reliable digital currency that reduces the impact of cryptocurrency market volatility, improves efficiency by reducing transaction costs, and provides faster and safer transactions. FDUSD is a programmable stablecoin that can execute financial contracts, custody services and insurance without intermediaries, and is backed by high-quality reserves (cash and cash equivalents).

According to blockchain browser data, First Digital has issued a total of 10,110,414 FDUSD on both Ethereum and BNB Chain. The project contract is audited by Paidun.

FDUSD Ethereum contract address

FDUSD BNB Chain contract address

What are the advantages of FDUSD?

Transferable

As an interchangeable digital currency, FDUSD supports frictionless and smooth transactions, making it a convenient choice for various application scenarios.

Redeemable

FDUSD is backed by high-quality reserve assets (cash and cash equivalents), which gives holders the ability to redeem their FDUSD tokens for an equivalent amount of U.S. dollars. This feature provides security for the stablecoin's reserves, and users can trust that FDUSD will always be backed 1:1.

Programmable

FDUSD is programmable, allowing the creation of smart contracts, escrow services, and insurance arrangements without the need for intermediaries. This programmability gives users greater control over their financial transactions while reducing transaction costs and increasing transaction speed and accuracy.

Low Fees

As a blockchain-based cryptocurrency, a significant advantage of FDUSD is its ability to offer cost-effective transactions with minimal fees. Unlike traditional financial transactions, which often incur high fees, blockchain-based transactions typically involve lower costs. This cost-effectiveness makes FDUSD an attractive economical option for users.

Runs on a decentralized network

As a stablecoin based on blockchain technology, FDUSD runs on decentralized networks that are distributed across multiple nodes. This enhances transparency, security, and resilience because no single entity fully controls the network.

Bankruptcy remoteness from the trustee

FDUSD’s legal reserves are held by the designated custodian, First Digital Trust Limited, in an account that is segregated from the custodian’s operational accounts. This means that even in the unlikely event of the custodian’s bankruptcy, the reserves backing FDUSD (to the extent held by the custodian or on behalf of the custodian) remain segregated and protected from the custodian’s other assets, ensuring that the stablecoin remains anchored and secure.

Conclusion

There is more information to pay attention to about this stablecoin issuer based in Hong Kong. As the home of the world's largest stablecoin USDT, Hong Kong, which already has a tradition of encryption, has received considerable attention with the strong support of the government this year. Even Binance has tried to find a contact person to contact the Hong Kong government. This seems to be one of the reasons why Binance chose FDUSD. But the most important thing about stablecoins is stability and security. With the current issuance scale of 10 million US dollars, FDUSD still has a long way to go.