Justin Sun announces listing of FTX exchange’s debt asset FUD on Huobi Global

• Justin Sun revealed that Samuel Bankman-Fried’s FTX exchange’s user debt has been tokenized to provide liquidity through FUD. 
• The debt is in tens of millions of dollars and the early bird issuance on Huobi is at a discount, capped at 20 million. 
• Crypto Twitter users have criticized the offering, citing that FUD tokensale is a likely violation of the US securities law. 

Huobi Global, one of the top cryptocurrency exchanges, has listed FTX exchange’s users’ debt in the form of a token (FUD). Justin Sun said that the bond token FUD represents the top quality FTX debt asset and is set to benefit everyone in crypto. 

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Justin Sun lists FTX User’s debt on Huobi as FUD token

Justin Sun, a Chinese crypto entrepreneur and majority shareholder in Huobi has announced the listing of FTX exchange’s users’ debt token (FUD). The bond token represents top quality FTX debt asset and Sun argues that this will benefit the crypto ecosystem. 

Sun argues that the FUD token provides creditors with a new level of liquidity, allows them to trade their debt in the open market and gives them greater control over their assets. This would open up new opportunities for investment in the debt token. 

The founder of Tron told market participants that it has been confirmed through a contract provided by DebtDAO that the debt is in the tens of millions of dollars. The early bird issuance phase will sell FTX the debt at a discount. 1 FUD = $1, and FUD token’s initial issuance and liquidity is 20 million. The fair price is at 0 < 1 FUD ≤ 5 USDT.

After FTX restores the database and confirms the actual debt of creditors, DebtDAO will issue a secondary public offering based on the actual amount of the debt and issue airdrops to all FUD holders. The fair price will be less than or equal to 1 USDT. 

Sun explained that if the actual amount of the debt is confirmed to be $60 million through the FTX database or published debt information, an additional 40 million FUD will be issued in addition to the initial 20 million FUD.

The first issuance of FUD is at a discount, users holding 1 FUD before the secondary public offering will receive an additional 2 FUDs from the airdrop. 

Will FUD make users whole after the losses from FTX exchange collapse?

Debt token’s issuance is expected to cover the actual amount of FTX’s user debt and reimburse users in USDT. Market participants on crypto Twitter have voiced their concerns against tokensale. Crypto Twitter believes that FUD tokensale could violate US securities laws. 

Wassielawyer on crypto Twitter believes the tokenization of FTX’s user’s debt is a securitization and not all debt claims are equal and fungible. 

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