Hong Kong-based stablecoin issuer expands to Sui network

Hong Kong-based stablecoins issuer First Digital Trust has announced plans to expand its token to the Sui blockchain. The dollar-pegged $3 billion FDUSD token had previously been available on Ethereum and BNB Chain. In a recent interview, First Digital CEO Vincent Chok revealed that this is one of the few efforts of the company to expand its presence in the decentralized finance (DeFi) sector.

Hong Kong-based First Digital Trust expands its token to Sui

First Digital’s token FDUSD is a stablecoin that conforms to the Hong Kong digital asset rule and is backed by US treasury bills and bank deposits. The token is pegged to the US dollar on a 1:1 ratio and has quickly grown in size to amass a market cap of about $3 million since it launched in 2023. Presently, it is the fourth largest stablecoin in the market, placing behind Tether’s USDT, MakerDAO’s DAI, and Circle’s USDC in no particular order.

The popularity of the Hong Kong-based company’s token stemmed from the promotion that it enjoyed on Binance. The exchange’s promotion of the token came after the New York State regulator ordered the shutdown of Paxos-issued Binance USD stablecoin. According to data on CoinGecko, the token has enjoyed a boost in its trading with about 90% of it from Bitcoin, Ethereum, and USDT trading pairs on Binance. Over the last 24 hours, it has enjoyed a trading volume of over $10 billion.

Implications for the DeFi community

In the interview, Chok highlighted the support that Sui is giving to the DeFi community despite being relatively new to the sector. He highlighted the growth of the network as being a trigger for the move while noting that the company wants to grow with the network. Sui has experienced big growth in the DeFi sector since its creation by a team of developers led by Meta’s now-defunct project Diem project. Its total value locked (TVL), a metric that shows the total amount of combined assets on a blockchain, is presently around $650 million, compared to the $100 million that it had last six months.

The shift to the Sui blockchain also positions FDUSD as the first stablecoin issued as a native token on the blockchain. Data from DefiLlama shows that Sui hosts $340 million worth of USDT and USDC with most of these assets coming in via a bridge from other blockchains, opening up users to risks and excessive fees. An executive of the blockchain also noted that the integration will help the Sui community and unlock new experiences for users and developers.