Cryptocurrency hedge fund, Three Arrows Capital (3AC) just filed for Chapter 15 bankruptcy! Here is what you need to know…
Crypto Hedge Fund 3AC Filed For Chapter 15 Bankruptcy!
The 2022 Crypto Winter continues to blow hard and cold…
On Friday, July 1, 2022, Singapore-based cryptocurrency hedge fund, Three Arrows Capital (3AC) filed for Chapter 15 bankruptcy in the Southern District of New York.
Representatives from the law firm Latham & Watkins filed the Chapter 15 bankruptcy filing to legally protect its US assets from creditors in the United States.
In the legal filing, they stated that “the Debtor’s business has collapsed in the wake of extreme fluctuations in cryptocurrency markets” and “the Debit commenced a liquidation processing before the BVI Court” on June 27, 2022.
This move came after a British Virgin Islands court ordered the liquidation of 3AC on Monday, June 27, 2022.
Voyager Digital revealed that 3AC failed to make payments on loans made up of US$350 million in USDC and 15,250 BTC (worth US$306 million), and issued them a notice of default on the same Monday, June 27.
3AC Founders Remain Silent On Bankruptcy, Location Unknown
Founded in 2012 by Zhu Su and Kyle Davis, 3AC managed about $10 billion in assets as recently as March 2022, but that sank to just $3 billion a month later.
3AC was dogged by persistent insolvency rumours in the last few weeks, with rumours of more than US$400 million in losses when the cryptocurrency markets collapsed between May and June 2022.
Zhu and Davis admitted in a WSJ interview that 3ACa lost their $200 million investment following the collapse of Luna and its sister coin, TerraUSD.
8 Blocks Capital chief executive Danny Yuan also alleged that 3AC had misappropriated US$1 million of its funds to pay off their margin calls.
Both co-founders have remained silent over the implosion of 3AC, and its bankruptcy. Zhu’s last Twitter post was on June 15, in which he sought to allay rumours of insolvency, while Davies has not said a word.
According to the lawyers from Latham & Watkins, their current locations are unknown, and they are “rumoured” to have left Singapore.
The foreign representatives understand and believe that while the debtor has had certain operations in Singapore, Mr. Davies and Mr. Zhu’s current location remains unknown. They are rumored to have left Singapore.
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