How Winslow Strong Became Central to Cred's $500M Bankruptcy Fraud Case

When cryptocurrency lending platform Cred collapsed in November 2020 amid what would become a multimillion-dollar fraud investigation, one name emerged repeatedly in court documents: Winslow Strong. The crypto consultant and “whale” investor found himself at the center of allegations involving over 516 Bitcoin—a transaction that creditors claimed was fraudulent, but which Strong maintained was simply a legitimate repayment of funds owed to him. His involvement in the case has become a cautionary tale about the complex relationships and murky financial dealings that characterized many early crypto lending platforms.

The Architecture of Cred’s Collapse

To understand how Winslow Strong became entangled in Cred’s downfall, it’s necessary to trace the company’s trajectory from its 2018 inception. Founded by Dan Schatt and Lu Hua in Singapore under the name Libra Credit, the company rebranded through multiple iterations—becoming Cyber Quantum, which conducted an initial coin offering in May 2018, before eventually settling on the name Cred.

The platform’s flagship product, CredEarn, operated on a deceptively simple premise: customers deposited cryptocurrency to the platform with promises of returns paid in the same digital asset, plus interest. Behind the scenes, however, Cred loaned these cryptocurrencies to MoKredit, a Chinese micro-lending platform co-founded by Cred’s own Lu Hua. MoKredit then distributed these funds to borrowers—reportedly thousands of gamers paying interest rates as high as 35%.

This arrangement created a fundamental structural vulnerability. While Cred’s obligations to CredEarn customers were denominated in various cryptocurrencies, its income from MoKredit came primarily through stablecoins. When crypto markets faced downward pressure, Cred faced widening losses. Additionally, regulatory and operational issues plagued the system, leaving the company vulnerable to the very market volatility it was supposed to manage.

The Entry of Winslow Strong

In early 2020, Cred executives identified Winslow Strong as a potentially valuable connection. Described internally as a “crypto whale” with substantial ties to high-net-worth digital asset investors in Puerto Rico, Strong began his relationship with Cred as a consultant referring wealthy clients to the platform. The relationship quickly deepened.

Cred approached Winslow Strong with two opportunities presented in close succession. The first was a straightforward investment: lending 500 Bitcoin to Cred through the CredEarn program at a 9% interest rate. The second—presented the day before the CredEarn agreement was finalized—involved purchasing bonds issued by Income Opportunities, a Luxembourg-based entity that both parties referred to as “bankruptcy remote.”

The marketing pitch for Income Opportunities emphasized its alleged insulation from Cred’s direct bankruptcy risks. What Strong was not told, or chose not to acknowledge, according to court filings from February 2022, was that Income Opportunities was itself lending 100% of its assets directly to MoKredit—the very entity that represented the source of Cred’s underlying financial distress.

The Core of the Dispute

According to court documents filed by the trust representing Cred’s creditors, on July 2, 2020—mere months before Cred’s complete collapse—the company transferred 516 Bitcoin to Winslow Strong. At the time, this represented approximately $4.8 million in value. By the time these transfers became subject to litigation, Bitcoin had appreciated significantly.

The creditors’ legal theory was stark: Cred paid this substantial amount in exchange for a bond that possessed essentially no real value. In their characterization, the transaction amounted to a fraudulent transfer—an act explicitly prohibited under bankruptcy law. As Darren Azman, an attorney at McDermott Will & Emery representing the Cred Liquidation Trust, explained to CoinDesk: “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 Strong presented a dramatically different narrative. He contended he was himself a victim of Cred’s broader misconduct. He maintained that his arrangement with Income Opportunities had always been structured as a temporary holding mechanism—a way to consolidate his Bitcoin position while maintaining exposure to what he believed were genuinely different assets and risk profiles. The note, he argued, simply matured on June 30, 2020, and Cred repaid him two days late.

The Legal Reckoning

The dispute proceeded through the bankruptcy court system beginning in 2022. Initially, the creditors pursued five separate counts against Winslow Strong. In May 2022—five months into the proceedings—two of these counts were dismissed. The remaining charges persisted until February 2023, when Strong and the plaintiffs reached a settlement agreement.

The case was dismissed “with prejudice,” legal language meaning it could never be reopened or relitigated. Winslow Strong later told CoinDesk that his defense costs and settlement obligations ultimately exceeded any profit he made on the original transaction, effectively erasing any financial gain.

For the Cred Liquidation Trust, the case represented one component of broader recovery efforts. Azman noted that the trust had “already traced and recovered a significant amount of cryptocurrency for the benefit of creditors” and pledged to continue “aggressive” pursuit of additional recoveries. However, the dismissal of charges against Strong meant one potential avenue for asset recovery had been closed.

Broader Context: The Fragility of Crypto Lending

The Cred saga was not an isolated incident in the crypto lending space. The structural vulnerabilities that toppled Cred—over-leverage, currency mismatches, interconnected counterparty risks, and inadequate due diligence—have plagued multiple lending platforms.

More recently, these patterns surfaced again. In 2025, Blockfills, a Chicago-based crypto lender that processed over $60 billion in trading volume, saw its co-founder Nicholas Hammer step down as CEO amid reports that some clients were encouraged to withdraw assets before the platform froze deposits and withdrawals in February 2025. The episode underscores how quickly trust can evaporate in crypto lending ecosystems.

Lessons from the Winslow Strong Case

The role of Winslow Strong in Cred’s bankruptcy proceeding illustrates several uncomfortable truths about early-stage crypto finance. First, it demonstrates how quickly legitimate-seeming structures—like Income Opportunities’ “bankruptcy remote” framing—can obscure underlying risks. Second, it shows how disputes in this space remain highly contested, with substantial disagreement over what constitutes fraud versus legitimate commercial activity.

Most significantly, the case reminds investors and platform operators alike that in emerging financial systems, apparent safeguards and risk management tools are only as robust as the institutions deploying them. Winslow Strong may have emerged legally vindicated, but he did so after years of litigation and substantial legal fees—a costly reminder that involvement in failed crypto platforms carries reputational and financial consequences regardless of legal outcomes.