Chinese cryptocurrency entrepreneur Justin Sun Yuchen is urging the Hong Kong government to quickly fix gaps in financial regulations. 

His call for action comes after revealing a “Ponzi scheme” involving a “traditional financial institution” in the city and Web3 platforms.

Sun raised concerns through a post on X, warning that First Digital Trust (FDT) — a Hong Kong-based custodian appointed to manage TrueUSD (TUSD) reserves — is not meeting its responsibilities to fulfill client fund redemptions. He strongly advised users to take steps to protect their assets.

In an exclusive interview with Sing Tao Headline — The Standard’s sister publication — Sun described the incident as “utterly…