First Digital USD (FDUSD) is a stablecoin issued by FD121 Limited, under the First Digital Labs brand based in Hong Kong, designed to maintain a 1:1 parity with the US dollar. Below, I provide an analysis based on recent information, along with an evaluation of whether it is advisable to invest in it.
FDUSD is backed by liquid assets such as short-term US Treasury bonds and cash deposits in dollars, held in segregated accounts at regulated financial institutions in Asia. The reserves are audited monthly by independent third parties, such as Prescient Assurance.
Programmability: FDUSD enables the execution of financial contracts, custody services, and insurance without intermediaries.
Availability: It is operational on blockchains such as Ethereum, BNB Chain, Sui, Solana, and recently Arbitrum, which expands its accessibility and liquidity.
Market capitalization and volume: As of December 2024, FDUSD has a market capitalization of approximately 1.74 billion USD.
Yield (APY): On platforms like Binance, FDUSD offers a higher yield compared to other stablecoins like USDT or USDC.
Associated Risks
Recent volatility: Although FDUSD is designed to be stable, in April 2025 it experienced a brief drop to 0.87 USD.
Whale concentration: 96.33% of FDUSD holders are large investors ("whales").
Is it advisable to invest in FDUSD?
The advisability of investing in FDUSD depends on your financial goals, risk tolerance, and investment strategy. Below is a detailed analysis.
Reasons to invest
Relative stability: As a stablecoin linked to the USD, FDUSD offers lower volatility compared to cryptocurrencies like Bitcoin or Ethereum.
Conclusion
FDUSD is a promising stablecoin with solid backing and regular audits, ideal for those seeking stability and liquidity in the crypto ecosystem, especially in DeFi. However, unverified insolvency accusations, its lower performance compared to competitors, and regulatory risks suggest caution. If you decide to invest, do so as part of a diversified portfolio and stay informed about audits and the regulatory environment. Conduct your own research and consider consulting a financial advisor before making decisions, as cryptocurrencies, even stablecoins, carry inherent risks.
Disclaimer
This analysis does not constitute financial advice.
