7 October 2022
Yesterday, there were rumors on social media platform Twitter that BlackRock, controversial trading firm Citadel, and Cryptocurrency exchange Gemini joined forces to destroy Terra.
The Crypto exchange Gemini allegedly loaned a whopping 100,000 Bitcoins to the previously mentioned companies so that they could buy UST from Terraform founder Do Kwon.
Citadel and BlackRock dumped their UST and Bitcoins holdings which triggered selling.
Additionally, the de-pegging of UST crashed the price of Terra (LUNA) which affected the whole market. These firms were allegedly able to buy back Bitcoin cheaply to repay the massive loan.
Cardano founder Charles Hoskinson also shared the above theory in a tweet which is now deleted.
Gemini was the first to deny such claims. Afterward, Citadel also busts the rumors and confirmed that it had nothing to do with LUNA’s crash since it doesn’t trade the UST stablecoin.
In a day, LUNA collapsed 96.43% to as low as $0.31. Currently, it is down by 99.75% from its record peak of $119.18.
Over the past year, BlackRock has been cautiously exploring Cryptocurrencies. In 2021, BlackRock entered Bitcoin futures. It also handles Circle's USDC cash reserves after participating in the fintech firm's $400 million funding round.
Disclaimer: The author’s thoughts and comments are solely for educational reasons and informative purposes only. They do not represent financial, investment, or other advice.