Crypto hedge fund 3AC reportedly enters liquidationwritten by Bella Palmer
Singapore-based 3AC is one of the higher profile crypto investors to have run into difficulties following the sharp sell-off in the market for digital currencies seen in recent months
Crypto hedge fund Three Arrows Capital (3AC) has entered liquidation, a person familiar with the matter told Reuters on Wednesday, in the latest sign of the market downturn hurting the crypto industry.
Singapore-based 3AC is one of the higher profile crypto investors to have run into difficulties following the sharp sell-off in the market for digital currencies seen in recent months.
Crypto broker Voyager Digital issued 3AC with a default notice on Monday after it failed to make payments on a loan of 15,250 bitcoin (approximately $324 million) and $350 million worth of USDC, a stablecoin.
A British Virgin Islands court order also dated on Monday ordered 3AC’s liquidation. Consultancy firm Teneo have been appointed as liquidators.
Top cryptocurrency bitcoin has plunged some 37% in June, trading around $20,000 on Wednesday, compared with its all-time high of $69,000 in November 2021. News of 3AC’s liquidation was first reported by broadcaster Sky on Wednesday.
3AC, co-founded by Zhu Su and Kyle Davies, is one of the most prominent crypto hedge funds (which focus on investments in digital assets like cryptocurrencies) around and is known for its highly leveraged bets. Zhu has extremely bullish views on bitcoin.
But a slump in digital currency prices, which has seen billions of dollars wiped off the market in recent weeks, has hurt 3AC and exposed a liquidity crisis at the company.
On June 15, 3AC’s co-founder sought to address liquidation rumours in a tweet, saying the company was ‘fully committed to working this out’, without going into further detail.
The unwinding of 3AC has sparked contagion fears to parts of the market that could potentially be exposed to the company.
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