A Dubai court has frozen more than $456 million (Dh1.67 billion) in assets worldwide in what is believed to be the first case involving the alleged diversion of funds backing a cryptocurrency stablecoin.
In a landmark decision disclosed in October, the DIFC Digital Economy Court issued an indefinite worldwide freezing order against Dubai-registered Aria Commodities DMCC and any banks or entities holding the disputed funds or assets linked to them.
The order, signed on October 17 by Justice Michael Black, prevents the movement or concealment of the $456 million and any related proceeds anywhere in the world. It is the DIFC Courts’ first global freeze involving cryptocurrency and carries penalties, including fines or imprisonment, for violations.
The case centers on TrueUSD (TUSD), a stablecoin designed to maintain a one-to-one value with the US dollar. Court documents showed that between 2021 and 2022, nearly half a billion dollars was allegedly diverted from TUSD’s dollar reserves into private investments, including commodity trading and mining ventures, using forged instructions and falsified documents.
Techteryx Ltd., owner of TrueUSD and controlled by Chinese cryptocurrency entrepreneur Justin Sun, said the discrepancy was uncovered during audits earlier this year. Sun, founder of the TRON blockchain, remains a prominent figure in global crypto markets and has previously faced regulatory scrutiny in the US.
To ensure token holders were unaffected, Techteryx said it injected hundreds of millions of dollars in new funds to keep every TUSD fully redeemable at one dollar. The company said no members of the public incurred losses due to the alleged diversion.
Techteryx has launched legal actions in multiple jurisdictions, including Hong Kong and the Cayman Islands. In Dubai, it sought a freeze to prevent the disputed funds from disappearing. Justice Black granted the request, ordering that the money and related assets remain untouched until the court issues further directions.
The order applies globally, and anyone assisting in moving the funds may face contempt proceedings in Dubai.
In a statement last month, Justin Sun called the ruling a “fair and resolute decision,” saying the freeze is a significant step toward recovering the reserves.
At a November 27 briefing in Hong Kong, he alleged that a network of custodians facilitated the transfers through cross-border routes and kickbacks, adding that Techteryx is focused on full recovery and advocating stronger international audits for stablecoins.
The DIFC’s Digital Economy Court was established to handle disputes involving cryptocurrencies, blockchain, and emerging technologies. A lawyer familiar with DIFC procedures said the order highlights Dubai’s willingness to use its legal mechanisms to safeguard the digital asset sector.
