Crypto Hedge Fund Files Three Arrows For Bankruptcy
Cryptocurrency hedge fund Three Arrows Capital (3AC) has filed for Chapter 15 bankruptcy in an effort to protect its US assets from creditors in the country, as previously reported by Bloomberg and CNBC. Representatives for the Singapore-based company filed the lawsuit in the Southern District Court in New York on Friday, which legally protects the US assets of insolvent foreign debtors from US creditors.
Founded in 2012 by Kyle Davis and Su Zhu, 3AC managed about $10 billion in assets as recently as March, later dropping to $3 billion in April. Like many other crypto companies, including lending giants Celcius and Babel Finance, 3AC’s role in wealth is part of the so-called crypto “winter” that has plunged stablecoins and lowered the value of bitcoin.
Earlier this week, it was reported that 3AC had failed to repay a $670 million loan provided by crypto broker Voyager Digital, which has since halted all trading, deposits and withdrawals as a result. Sky News It later reported that a court in the British Virgin Islands had ordered the liquidation of 3AC and that the company was working with business advisory firm Teneo to oversee the process.
In May, Davis and Zhou admitted in an interview with The Wall Street Journal The company lost a $200 million investment following the collapse of Luna and its sister coin TerraUSD. At the time, the two remained optimistic about crypto’s prospects, telling The Wall Street Journal That they have “always been a believer in cryptocurrency” and “are still.”