BlackRock and Citadel allegedly caused one of the largest #crypto crash of the last years. The two investors allegedly borrowed 100k #BTC from Gemini, swapped 25K of #BTC into #TerraUSD (#UST), called Terra Foundation suggesting they’d want to sell a large chunk of BTC for UST, and hinted to buy them at discount to avoid moving the market.

Terra ($Luna) agreed to buy BTC for UST at a discount, lowering its own UST liquidity and reserves significantly. After which, BlackRock and Citadel dumped all UST and #BTC causing massive slippage and triggering a cascade of forced selling in both assets.

At the same time, this also triggered a cascade of withdrawals from another large crypto, $AnchorProtocol, holding large quantities of $Luna. The withdrawals were more than Anchor could repay, triggering a further sell-off in $Luna, thus further breaking the $1 peg of UST/USD.

#BTC currently trading below $27,000 (down 32.2% in 1 week) can now be bought by BlackRock and Citadel much cheaply, they can repay their loan, and pocket billions in difference. Meanwhile, over $300bn of long positions in stable and altcoins were wiped out, and $Luna tumbled from $86 to $0.16 in less than a week.

While BlackRock and Citadel denied the claims, only the actions of very large institutional investors could trigger such a tumble by two of the largest #cryptocurrencies. This was pure market manipulation. It is surprising that the largest investors in the world and loud advocate for ESG and Ethical investment is allegedly behind such actions. At which point trading and investing becomes market manipulation? Is #crypto investing supposed to align to #ESG standards, or is it still considered no man's land due to lack of regulations?