The world’s largest asset manager Blackrock and hedge fund giant Citadel Securities have denied claims that they played a role in the demise of Terrausd (UST) and Terra (LUNA). Additionally, crypto exchange Gemini has denied providing a bitcoin loan that led to Terra’s collapse.
Blackrock, Citadel Securities, Gemini deny rumours
Following the collapse of terra (LUNA), after algorithmic stablecoin terrausd (UST) lost its peg to the US dollar this week, rumors circulated that Blackrock, Citadel Securities and Gemini were involved in the case. The three companies quickly denied the accusation.
According to the rumors, Blackrock and Citadel Securities borrowed 100,000 BTC from cryptocurrency exchange Gemini and swapped 25% for UST. The two companies then dumped UST and BTC, sending the prices of the two cryptocurrencies plummeting.
On Wednesday, the official Twitter account of Blackrock, the world’s largest wealth manager, tweeted:
Rumors that we played a role in the collapse of UST are categorically false. In fact, Blackrock does not trade UST.
The asset manager recently endorsed Circle Internet Financial Ltd., the issuer of another stablecoin called USD Coin (USDC). Circle’s stablecoin is currently the fourth largest crypto with a market cap of nearly $50 billion.
The cryptocurrency exchange Gemini also denied the rumours. The company tweeted on Wednesday:
We are aware of a recent story that suggests that Gemini issued a 100,000 BTC loan to major institutional counterparties, which reportedly prompted a LUNA sell-off. Gemini made no such loan.
Hedge fund giant Citadel Securities also said it had nothing to do with the collapse of stablecoin UST. A company representative told Bloomberg that the company “does not trade stablecoins, including UST.”
In March, Citadel Securities announced that it plans to get involved in creating cryptocurrency markets in the coming months.
The collapse of LUNA rocked the crypto market. At the time of writing, the price of the cryptocurrency has fallen to $0.035, down almost 100% in the past 24 hours. Meanwhile, UST fell to a low of $0.30 on Wednesday but has since recovered to the current price of $0.60.
Do you think Blackrock, Citadel Securities and Gemini played a role in Terra’s collapse? Let us know in the comment section below.
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