Crypto hedge fund Three Arrows Capital (3AC) has reportedly plunged into liquidation, as per Sky News. This will deepen the crisis grappling the crypto space.
Three Arrows Capital Liquidation
According to the report, partners from Teneo Restructuring in the British Virgin Islands has been lined up to handle the insolvency of the Singapore-based firm. Earlier in the week, Voyager Digital said it had issued Three Arrows Capital with a notice of default.
The firm said one of its units had issued 3AC with a default notice for its inability to repay a loan. The loan amount includes 15,250 Bitcoin and $350 million in USDC, worth around $660 million.
The report added that the liquidation could be a key moment for the prospects of the rapidly growing cryptocurrency sector. However, it was unclear what the immediate financial implications would be for Three Arrows’ creditors.
Where Did It All Begin For 3AC?
For Three Arrows, the crisis situation began with the collapse of LUNA and UST in May. Th firm is said to have bought money off investors and deposited it into the anchor protocol.
Speculation is rife that Three Arrows did not inform investors about its interests in UST position. The company allegedly used counter-party funds to build a huge UST position in anchor protocol.
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