Gemini Denied The 100K BTC Loan Rumors To Citadel And BlackRock

Gemini denied the 100K BTC loan rumors to Citadel and BlackRock and also about their potential involvement in LUNA’s price drop so let’s have a closer look at today’s latest Bitcoin news.

The New York-based crypto custody exchange Gemini denied the 100K BTC loan and their involvement in the LUNA price crash. Gemini denied the allegations that the company contributed to the price plunge of LUNA after loaning 100,000 BTC worth $2.8 billion to companies like Citadel and BlackRock. The tweet read:

“We are aware of a recent story that suggested Gemini made a 100K BTC loan to large institutional counter-parties that reportedly resulted in a selloff in LUNA. Gemini made no such loan.”

Earlier rumors stated that both these investment companies borrowed 100,000 BTC from Gemini and they swapped 25,000 BTC for UST which is a stablecoin that lost its peg and later dump both assets which triggered LUNA’s selloff and broke the UST $1 peg. Blackrock and Citadel dispelled the rumors and one source said the company is not involved in the stablecoin trading including UST. Citadel and Blackrock noted the company didn’t trade UST.

LUNA is down over 99% in value hovering around $0.30 while UST is yet to regain its dollar parity at $0.6. in the meantime Do Kwon as the founder of Terraform Labs proposed a plan to restore the UST peg and the way ahead will be to absorb the stablecoin supply that wants to exit before eUST starts to repeg. Kwon noted that Terra’s endorsed community proposal suggested an increase in LUNA’s minting capacity from $293 million to around $1.2 billion and the Terraform Lab chief added that UST is being rebuilt so the team will adjust the stablecoin’s mechanism to be collateralized.

In the wake of LUNA’s price crash, the South Korean exchanges issued warnings about the token, and UpBit even deemed LUNA as a cautionary item while BitHumb designated the asset as an investment warning item in order to protect its investors. The designation was issued because of the high price fluctuations of the token. Bithumb noted that the warning didn’t mean that LUNA was suspended but said the exchange could decide to stop trading the token or not after the warning elapses.