Winslow Carter Strong and the Cred Bitcoin Dispute: A Six-Year Legal Battle Concludes

When Cred, a cryptocurrency lending platform, collapsed into bankruptcy in November 2020, one of the most contentious questions that emerged involved consultant and crypto investor Winslow Carter Strong. The crux of the matter: did Strong receive a questionable transfer of 516 bitcoin—worth roughly $4.8 million at the 2020 transaction and potentially valued at approximately $35 million today at current BTC prices—or was he legitimately repaid for funds he had lent to the troubled platform?

The case, which wound through courts for over three years, ultimately settled in February 2023 with the dismissal of remaining charges. Yet the dispute highlighted the murky intersection of high-stakes crypto lending, insider relationships, and bankruptcy law.

The Foundation: How Cred Built Its Lending Model

Cred’s journey began in 2018 when Dan Schatt and Lu Hua established what was initially called Libra Credit in Singapore. The company rebranded through Cyber Quantum, which conducted an initial coin offering in May 2018 before eventually settling on the name Cred after relocating to the United States.

The platform’s flagship offering was CredEarn, a product where customers deposited cryptocurrency with the promise of receiving repayment plus interest in the same digital asset. Cred would then loan these cryptocurrencies to MoKredit, a Chinese micro-lending platform partially owned by co-founder Lu Hua. MoKredit subsequently extended these funds to borrowers—reportedly thousands of gamers—at interest rates reaching as high as 35%.

This structure created a critical vulnerability: while Cred’s deals with MoKredit were conducted in stablecoins, the company’s obligations to CredEarn customers remained denominated in volatile cryptocurrencies. This mismatch left Cred dangerously exposed to price fluctuations.

Strong’s Entry: From Consultant to Significant Stakeholder

In early 2020, Winslow Carter Strong began developing ties with Cred as a consultant, leveraging his reputation as a “crypto whale” with substantial connections throughout Puerto Rico’s high-net-worth crypto community. His initial role involved introducing wealthy crypto investors to the platform.

Cred executives soon approached Strong with a dual opportunity. He agreed to lend 500 bitcoin to CredEarn at a 9% interest rate. But simultaneously, Cred proposed an alternative investment: purchasing a bond issued by Income Opportunities, a Luxembourg-based entity that Cred marketed as a “bankruptcy remote” investment vehicle.

Winslow Carter Strong would later emphasize that he understood the financial pressures surrounding Cred. Company executives had provided him with confidential briefings on MoKredit’s operations in January 2020, yet he maintained that purchasing the Income Opportunities bond was a strategic choice—not an attempt to flee cryptocurrency exposure, but rather to concentrate his position in an entity he believed was more insulated from Cred’s direct liabilities.

According to Strong’s account, the Luxembourg entity was lending 100% of its assets directly to MoKredit, and his intention was always to roll over his CredEarn loan into this structure as soon as it was operationally ready.

The Disputed Transaction: The 516 Bitcoin Transfer Under Legal Scrutiny

On July 2, 2020—at a moment when Cred was already spiraling toward insolvency—the company transferred 516 bitcoin to Winslow Carter Strong. Cred execs characterized this as fulfillment of the Income Opportunities bond purchase. The plaintiffs’ later legal complaint, however, alleged something fundamentally different: that Cred paid Strong for an essentially worthless bond, constituting a fraudulent transfer in violation of bankruptcy law.

According to court filings from February 2022, Darren Azman, an attorney representing the Cred Liquidation Trust at McDermott Will & Emery LLP, argued: “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 disputed this characterization entirely. He contended that the transfer was a straightforward repayment of principal and accrued interest on his original 500-bitcoin loan. The bond agreement, reviewed by CoinDesk, bore a maturity date of June 30, 2020—meaning Strong claimed he received his funds two days after the contractual maturity.

Legal Battle and Resolution: How the Case Was Settled

The Cred Liquidation Trust filed suit, alleging five counts of fraudulent transfer and seeking to recover the cryptocurrency. The trust had already recovered a significant amount of digital assets for creditors and signaled its intent to pursue aggressive recovery strategies.

However, the litigation trajectory shifted. By mid-2022, the court dismissed two of the five counts against Winslow Carter Strong. Then, in February 2023, Strong and the trust’s representatives reached a settlement. The remaining charges were dismissed with prejudice, meaning the case could never be reopened.

The outcome was bittersweet for Strong. He revealed to CoinDesk that his total losses—encompassing both legal defense fees and settlement obligations—exceeded any profits he had realized from the transaction or subsequent interest payments. In his view, he emerged as another victim of Cred’s financial mismanagement and internal contradictions.

Meanwhile, the Cred Liquidation Trust continued its broader recovery efforts, tracing cryptocurrency holdings and pursuing other parties involved in the company’s collapse. The bankruptcy proceedings underscored the complex legal terrain surrounding digital asset transfers and insider dealings during corporate insolvency events.

The Cred case serves as a cautionary tale about the risks embedded in early-stage cryptocurrency lending platforms, the opacity of insider transactions, and the prolonged legal battles that can ensue when a once-promising fintech venture unravels.