Gemini Denies Rumors of A 100K Bitcoin Loan to BlackRock and Citadel

Gemini, a cryptocurrency custodian and exchange based in New York, has denied any role in the big selloff of Terra’s native cryptocurrency, LUNA.

Gemini has rejected claims that it helped to the LUNA price drop by lending 100,000 bitcoin (worth $2.8 billion at the time of writing) to investment firms BlackRock and Citadel, via its official Twitter account. According to the crypto exchange’s tweet:

According to previous claims, BlackRock and Citadel borrowed 100,000 BTC from Gemini. Both companies are accused of exchanging 25,000 BTC for UST, an algorithmic stablecoin that has lost its peg, only to dump both assets later, allegedly triggering LUNA’s big selloff and further breaking UST’s $1 peg.

According to a Forbes report, BlackRock and Citadel have also debunked the accusations. Citadel, according to a source, is not involved in stablecoin trade, including UST. Like Citadel, BlackRock stated that it does not trade UST.

According to CoinGecko, the price of LUNA is currently down over 99%, resting around $0.30. The UST stablecoin is currently trading at $0.6, having yet to regain dollar parity.

Meanwhile, Terraform Labs CEO Do Kwon recently offered a plan to restore UST’s peg. The way forward, according to the executive, is to “absorb the stablecoin supply that wants to exit before UST can start to repeg.”

Terra also endorsed community proposal 1164, which asks that LUNA’s minting capacity be increased from $293 million to roughly $1.2 billion. The Terraform Lab chief added that as UST is being rebuilt, the team will adjust the stablecoin’s mechanism to be collateralized.

South Korean exchanges have issued warnings on the crypto asset LUNA following its price drop. To protect investors, Upbit labeled LUNA as a “cautionary item,” while Bithumb categorized the asset as an investment warning item.

Because of the token’s large price volatility, the designation was given. Bithumb clarified that the warning did not imply that LUNA had been suspended, but that after the designated warning had expired, the exchange might decide whether or not to halt trade of the coin.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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