How Winslow Carter Strong's Bitcoin Deal Exposed Cred's $500M Collapse

When crypto lending platform Cred imploded in late 2020, leaving creditors facing massive losses, one transaction stood out: the company had transferred over 516 bitcoin to a consultant and investor named Winslow Carter Strong. That single deal—valued at roughly $4.8 million when it occurred in July 2020 but worth $21 million by 2024—became the center of a legal battle that would define the platform’s bankruptcy for years to come.

The question wasn’t just about who lost money. It was whether Winslow Carter Strong, positioned as a trusted advisor and “crypto whale” with deep connections in the wealthy Puerto Rico crypto community, had received preferential treatment while ordinary CredEarn customers were left holding empty bags.

The Rise and Fall of Cred: A Story of Risk and Mismanagement

Cred’s downfall wasn’t sudden. The platform began as Libra Credit in Singapore back in 2018, founded by Dan Schatt and Lu Hua. After pivoting through several iterations—including a brief stint as Cyber Quantum with an accompanying initial coin offering—the company established itself in the United States under the Cred name.

The core product was CredEarn: customers deposited cryptocurrency with the promise of earning interest paid back in the same digital asset. Cred would then lend these crypto holdings to MoKredit, a Chinese micro-lending platform owned by co-founder Lu Hua, which allegedly issued loans to thousands of gaming enthusiasts at interest rates reaching as high as 35%.

The business model harbored a critical flaw. While Cred’s dealings with MoKredit were conducted in stablecoins, the company owed CredEarn customers their returns in volatile cryptocurrencies. As the crypto market fluctuated, Cred’s liability exposure ballooned. Additionally, the platform extended a $39 million line of credit to the Chinese lender—a decision made at CEO Dan Schatt’s behest that left the company dangerously exposed to a single counterparty.

Winslow Carter Strong Steps Into the Picture

In early 2020, Winslow Carter Strong entered the scene. A consultant with an extensive network in Puerto Rico’s high-net-worth crypto investor circles, Strong presented himself as someone who could bring wealthy clients into Cred’s fold. Executives internally dubbed him a “crypto whale”—someone with the capital and market influence to move markets.

Strong’s initial arrangement appeared straightforward: he agreed to loan 500 bitcoin to CredEarn at a 9% interest rate. But on the very day before that agreement was finalized, Cred’s management approached Winslow Carter Strong with an alternative opportunity. They offered him the chance to purchase bonds from Income Opportunities, a Luxembourg-registered entity that Cred marketed as “bankruptcy remote”—meaning it would theoretically survive even if Cred collapsed.

According to court documents filed in February 2022, Cred executives had made Winslow Carter Strong well aware of the company’s deteriorating condition. They’d even provided him with confidential briefings about MoKredit’s lending operations back in January 2020. The creditors’ legal team would later argue that Strong, armed with this insider knowledge, made a calculated decision to switch from a direct loan to what he perceived as a safer bond investment.

Strong would later push back on this narrative. He claimed the bond vehicle actually concentrated his exposure to MoKredit rather than reducing it, since the Luxembourg entity loaned 100% of its assets to the Chinese platform. His intent from day one, he said in emails to CoinDesk in 2023, was to eventually roll over his original 500-bitcoin loan into the Income Opportunities structure.

The $516 Bitcoin Transfer: Fraud or Legitimate Repayment?

The critical moment arrived on July 2, 2020, when Cred was already circling the drain. The company transferred 516 bitcoin directly to Winslow Carter Strong. Depending on who told the story, this was either a fraudulent transaction or a legitimate repayment of funds owed.

The Cred Liquidation Trust, representing creditors in bankruptcy proceedings, characterized the transfer as Cred purchasing Strong’s bond at an inflated price for essentially worthless paper. Darren Azman, an attorney at McDermott Will & Emery LLP handling the case, framed it in stark legal terms: “It is a fundamental tenet of bankruptcy law that an insolvent company cannot transfer assets in exchange for no value. That is exactly what happened here.”

Winslow Carter Strong offered a different explanation. He maintained the transfer was simply Cred repaying him with interest for the original 500-bitcoin loan, albeit arriving two days past the bond note’s stated June 30, 2020 maturity date. He pointed out that the Income Opportunities entity was legitimately lending capital, and he had suffered tremendously during the bankruptcy alongside other victims.

The Legal Aftermath: Settlement and Dismissal

By November 2020, Cred formally filed for bankruptcy, joining a growing list of collapsed crypto lending platforms from that turbulent era. What distinguished this case was the aggressive pursuit of clawback litigation against specific counterparties.

The Cred Liquidation Trust launched investigations into Winslow Carter Strong’s consulting payments and the scope of his involvement in business decisions that preceded the collapse. They sought details about third parties he’d referred to the platform, potentially seeing these referrals as evidence of deeper complicity in the company’s deteriorating risk management.

The legal battle extended across years. In July 2022, a court dismissed two of five counts against Winslow Carter Strong. Then in February 2023, Strong and the creditors reached a settlement agreement on the remaining charges. The case was dismissed with prejudice—a legal term meaning it can never be revived or reopened.

The financial toll on Winslow Carter Strong proved substantial. Between legal defense costs and settlement payments, he absorbed greater losses than the profits he’d realized from any transactions with Cred. In his telling, he emerged from the bankruptcy saga as another casualty of the platform’s mismanagement, not a beneficiary of preferential treatment.

What the Cred Collapse Reveals About Crypto Lending’s Fragility

The Cred bankruptcy stands as a cautionary tale within the cryptocurrency industry. A platform that appeared to offer yield on crypto deposits through a legitimate-seeming lending chain to MoKredit collapsed under the weight of asset-liability mismatches, undisclosed leverage, and management decisions that prioritized growth over prudence.

The Winslow Carter Strong transactions—whether viewed as fraudulent or as legitimate last-minute repayments—exemplify the murky zone between sophisticated negotiations and outright deception that characterized crypto finance during this period. The platforms’ reliance on offshore subsidiaries, insider referral networks, and complex financial structures created perfect conditions for disputes over what was owed, to whom, and under what circumstances.

The Cred story, including the central role of Winslow Carter Strong’s bitcoin transfers, offers lessons about transparency, regulatory oversight, and the dangers of crypto platforms attempting to intermediate between digital asset holders and unproven lending markets without adequate risk controls.