On Monday 27th June 2022, a British Island court ordered the liquidation of a crypto hedge fund, Three Arrows Capital. This comes after Three Arrows Capital, which was founded in 2012 by Su Zhu and Kyle Davies, suffered heavy losses in the current crypto market downtrend. The likelihood of bankruptcy was first reported in June after the company, also known as 3AC, lost at least $400 million in liquidations.

Voyager Digital Ltd. (Crypto brokers) issued a default notice to 3AC after the company failed to make its stipulated payments on a 15,250 Bitcoin loan and $350 million in USDC. Voyager’s shares also nosedived once they released news about their involvement with 3AC.

Partners from Teneo (financial consultants) have been approached to handle the Singaporean crypto fund’s liquidation with a heavy focus on the protection of the company’s assets. In time, a website will be set up and announced for potential creditors to submit claims. Three Arrows have however been remarkably silent amid the current market turbulence although CEO Zhu Su tweeted recently that they are in talks with relevant parties and are committed to solving this humongous problem.

Insolvency at Three Arrows is already raising eyebrows about other crypto businesses and hedge funds because, until liquidation speculations in June, Three Arrows was considered a successful and well-established player in the market. This could also pressurize token prices if it involves unwinding big positions in an already complicated market. While there is much pain because of a tough macroeconomic environment, issues at crypto financial services groups have compounded the declines.

Featured image source: Coincu News

Leave a Reply

Your email address will not be published. Required fields are marked *

Captcha Plus loading...