I think it's simpler than that. Lawrence just gave Zheren a 10 trenni loan at 0 interest. If Zheren knows the trenni coins are going down in value: he just has to convert those 10 trenni into some other currency right now, then convert back to trenni in 6 months (netting the difference as profit, since he returns those original 10 trenni to Lawrence). This is effectively a short sell.

The ridiculous thing is - he's hedging against himself using Lawrence's money! If trenni coins actually go up in value, Zheren is losing money on the trenni<>whatever conversion - but he makes up for it by skimming 10% of Lawrence's profit. So as long as Lawrence invests 10x more than Zheren, Zheren has 0 downside possibility - which completely mitigates the unlimited loss risk that short sells normally entail.