Cryptocurrency exchange Huobi Global, which has recently come to the fore with tokens it has removed from the list one after another, has listed a new token called “FUD token”, which is associated with receivables in FTX. FUD, short for “FTX User Debt Token”, will start trading on Huobi as of 15.00 CET.
Stating that this is a bond token, Sun said, “We created it for the benefit of everyone in the crypto world. Stop FUD and trade FUD on Huobi Global!” used the phrases.
How will the system work?
Detailing his statements, Sun noted that the FUD token will provide creditors with a new level of liquidity and enable them to buy and sell FTX debts on the open market. According to the statement, the token in question will be controlled by DebtDAO. While 1 FUD was determined as 1 dollar, 20 million FUD was released in the first place. After FTX confirms the actual debt amount of the creditors via its database or official disclosure, DebtDAO will conduct a secondary public offering based on this amount and airdrop to all FUD token holders.
For example, if the amount of debt disclosed and verified is $60 million, an additional 40 million FUD will be issued in addition to the 20 million FUD released in the first phase. After the airdrop, DebtDAO will do a 1:1 debt repurchase for FUD holders. Additionally, DebtDAO said it will release a notarized proof of contract or debt at the appropriate time.
Announced by Justin Sun and Huobi, the FUD token received intense criticism and sparked new controversy. Some lawyers have argued that this is a violation of securities laws. A lawyer specializing in restructuring and bankruptcy law, but keeping his identity confidential Wassielawyernoting that not all claims are equal and affordable, but also that the project is a violation of securities laws, he said, “It’s a terrible idea.”
reminds me of GTX
Recently, it was revealed that the founders of the bankrupt crypto hedge fund 3AC began receiving investment to establish an exchange called “GTX”. Unlike the usual exchanges, GTX has FTX, BlockFi, Celsius and Mt. Assets receivable on bankrupt platforms like Gox would be traded. Justin Sun’s FUD Token initiative reminded this exchange, which has not yet been operational.
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