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Gemini Denies BlackRock and Citadel 100,000 Bitcoin Loan Rumors

New York-based cryptocurrency custody and exchange Gemini has faced allegations over its involvement in the massive Terras native sell-off cryptocurrency LUNA rejected.

Gemini says it is not involved in LUNA’s price drop

Gemini, via its official Twitter handle, has denied previous rumors that the company contributed to LUNA’s price drop after selling 100,000 Bitcoin (worth $2.8 billion at the time of writing) to investment company giants BlackRock and Citadel. The crypto exchange’s tweet said:

“We are aware of a recent story that suggests that Gemini made a 100,000 BTC loan to major institutional counterparties, which has reportedly led to a LUNA sell-off. Gemini made no such loan.”

our recommendation Gemini Denies BlackRock and Citadel 100,000 Bitcoin Loan Rumors, Crypto Trading News

Previous rumors claimed that BlackRock and Citadel jointly borrowed 100,000 BTC from Gemini. Both companies reportedly exchanged 25,000 BTC for UST, an algorithmic one stablecoinwhich lost its peg, only to later dump both assets, allegedly sparking LUNA’s massive sell-off and further breaching UST’s $1 peg.

BlackRock and Citadel have also dispelled the rumors, according to a Forbes report. A Citadel source said the company is not involved in any stablecoin trading, including UST. BlackRock, like Citadel, found that the company did not trade in UST.

According to CoinGecko, LUNA is currently down over 99% with the price fluctuating around $0.30. The UST stablecoin, which has yet to regain dollar parity, is trading at $0.6.

Meanwhile, Do Kwon, founder of Terraform Labs, recently proposed a plan to restore UST’s bond. According to the executive, the way forward would be to “absorb the stablecoin supply that wants to exit before UST can start repricing.”

Kwon also noted that Terra endorsed Community Proposal 1164, which proposes increasing LUNA’s minting capacity from $293 million to around $1.2 billion. The head of the Terraform lab added that while UST is rebuilding, the team will adjust the stablecoin’s mechanism to collateralize it.

Major South Korean exchanges put LUNA on warning list

South Korean exchanges warned about the crypto token after LUNA’s price crash. Upbit considered LUNA an “item of caution,” while Bithumb described the asset as an investment cautionary item to protect investors.

The designation was given due to the high price fluctuations of the token. Bithumb noted that the warning did not mean LUNA was suspended but said that the exchange could decide to stop trading the token or not after the designation warning expired.

Source: Crypto News Deutsch

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