Key Takeaways
- FDUSD is a fiat-backed stablecoin issued by FD121 Limited, a subsidiary of Hong Kong-based First Digital Limited.
- It launched in June 2023 and gained momentum after Binance encouraged users to switch from BUSD to FDUSD.
- The stablecoin operates on Ethereum (ERC-20) and BNB Chain (BEP-20), ensuring compatibility across platforms.
- Its reserves are held in low-risk assets like short-term U.S. treasury bills and cash equivalents, ensuring its 1:1 peg to the US dollar.
- FDUSD is used for remittances, payments, hedging against volatility, and decentralized finance (DeFi) applications.
First Digital USD (FDUSD) has quickly become a prominent stablecoin since its launch in June 2023. It provides the stability of the US dollar while leveraging blockchain technology for efficiency and accessibility. Issued in Hong Kong, FDUSD gained significant traction when Binance announced it would phase out its native Binance USD (BUSD) and encouraged users to transition to FDUSD in September 2023. This move boosted FDUSD’s adoption, with trading volumes often surpassing those of major trading pairs. As of April 7, 2025, FDUSD is valued at $1.00, with a circulating supply of approximately 2.59 billion tokens and a market capitalization of $2.57 billion.
What Is First Digital USD?
First Digital USD is a fiat-collateralized stablecoin designed to provide stability in the volatile cryptocurrency market. Launched on June 1, 2023, by FD121 Limited, a subsidiary of Hong Kong-based First Digital Limited, it maintains a 1:1 peg with the US dollar. Each token is backed by one US dollar or an equivalent asset.
FDUSD was introduced shortly after Hong Kong implemented new regulations for virtual asset trading platforms, making it one of the first stablecoins to comply with these guidelines. Its goal is to bridge traditional finance and digital currencies by offering users a secure and transparent way to transact, remit funds, and participate in DeFi applications.
Who Is Behind First Digital USD
FDUSD is issued by FD121 Limited, part of First Digital Limited, a financial firm headquartered in Hong Kong. The company is led by Vincent Chok, the CEO of First Digital Trust, which acts as the custodian for FDUSD’s reserves. Chok has extensive experience in financial services and previously founded Legacy Trust Company, a licensed trust company in Hong Kong. First Digital Limited has offices across the UK, Middle East, Singapore, and Malaysia. It serves clients such as financial institutions, fintech companies, blockchain startups, and digital asset exchanges.
How First Digital USD Works: A Technical Explanation
FDUSD operates on Ethereum and BNB Chain using ERC-20 and BEP-20 token standards. This multi-chain approach ensures compatibility with various decentralized applications and exchanges.
The stablecoin’s value is maintained through fully backed reserves held by First Digital Trust Limited. These reserves consist of low-risk assets like short-term U.S. treasury bills and cash equivalents stored in segregated accounts at financial institutions in Hong Kong, Switzerland, and Australia. This ensures that each FDUSD token can be redeemed for its equivalent value in US dollars.
Transparency is central to FDUSD’s operations. Monthly reserve reports are published and audited by independent firms to confirm that all circulating tokens are fully backed. Additionally, FDUSD’s programmability allows integration with smart contracts for automated transactions in DeFi applications.
Current Status of First Digital USD In The Wider Ecosystem
FDUSD has rapidly gained prominence within the stablecoin ecosystem since Binance endorsed it as an alternative to BUSD in September 2023. Stablecoins like FDUSD play an essential role in bridging traditional finance with digital assets while providing price stability amidst crypto market volatility.
On Binance, FDUSD has achieved remarkable trading volume growth. By early 2024, its BTC/FDUSD pair had surpassed BTC/USDT trading volumes by 65%, despite having a much smaller circulating supply compared to USDT. This highlights strong adoption among traders who value its transparency and functionality. In the competitive stablecoin market dominated by Tether (USDT) and USD Coin (USDC), FDUSD has carved out its niche by offering regulatory compliance under Hong Kong’s framework and multi-chain compatibility.
First Digital USD’s Price Journey
As a stablecoin pegged to the US dollar at a 1:1 ratio, FDUSD has maintained price stability since its launch in June 2023. Its value consistently remains at $1.00 even during periods of market turbulence. This reliability underscores the effectiveness of its reserve-backed model.
Unlike volatile cryptocurrencies like Bitcoin or Ethereum, FDUSD offers users a dependable store of value for transactions or hedging against market swings. As of April 7, 2025, it continues to trade at $1.00.
Current Data & Interesting Statistics About First Digital USD
- Circulating supply: Approximately 2.59 billion tokens as of April 7, 2025.
- Market capitalization: Around $2.57 billion.
- Daily trading volume: By early 2024, BTC/FDUSD trading volume on Binance reached $1.658 billion—65% higher than BTC/USDT.
- Blockchain networks: Operates on Ethereum (ERC-20) and BNB Chain (BEP-20), with plans for expansion.
- Reserve composition: Backed by low-risk assets like short-term U.S. treasury bills.
- Transparency: Monthly reserve reports audited by independent firms.
- Adoption: Rapid growth in transaction volume highlights strong user trust.
What Is The Future of First Digital USD
The future of First Digital USD (FDUSD) looks promising as stablecoins continue to play a vital role in the cryptocurrency ecosystem. FDUSD is well-positioned to benefit from the growing demand for regulated and transparent digital assets, particularly in the Asia-Pacific region, where it has established a strong presence. Its compliance with Hong Kong’s regulatory framework provides a competitive edge as global scrutiny of digital assets increases.
First Digital has plans to expand FDUSD’s availability across additional blockchain networks, aiming to enhance interoperability and accessibility. The company also seeks to strengthen partnerships with financial institutions and cryptocurrency exchanges, which could further increase FDUSD’s utility and adoption in various applications. Success will depend on maintaining its 1:1 peg to the US dollar, ensuring transparency, and adapting to evolving regulatory standards across global markets.
The Road Ahead for Stablecoin Innovation
First Digital USD represents an important development in the stablecoin space by combining transparency with regulatory compliance under Hong Kong’s framework. Since its launch in mid-2023, it has shown impressive growth due to strong partnerships like Binance’s endorsement.
FDUSD’s ability to maintain its peg while offering multi-chain functionality makes it an attractive option in an increasingly competitive market dominated by other major stablecoins like USDT and USDC. As regulatory scrutiny grows worldwide and demand for reliable digital assets increases among institutional investors and retail users alike, FDUSD is well-positioned for continued success.
Its future hinges on maintaining trust through transparency while expanding its ecosystem across more blockchain platforms, effectively bridging traditional finance with decentralized innovation.
Michael Crag
