Liquidation of 3AC Ordered in British Virgin Islands
- A person with knowledge of the matter told Sky News that a BVI court had ordered the liquidation of crypto hedge fund Three Arrows Capital on 27 June.
- Earlier this week, Voyager Digital issued a notice of default to 3AC for failing to pay its loan of 15,250 BTC and 350 million USDC.
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The British Virgin Islands (BVI) has ordered the liquidation of Singapore-based cryptocurrency hedge fund Three Arrows Capital (3AC), news agency Sky News reported on 29 June.
The publication cited a person with knowledge of the matter, who said a court in the BVI issued the order to liquidate the crypto hedge fund on 27 June. The source further noted that partners from the New York-based financial advisory firm Teneo Restructuring have been called in to handle the company’s insolvency.
Founded by Kyle Davies and Su Zhu in 2012, Singapore-based Three Arrows Capital grew to be one of the largest crypto hedge funds on the market. The firm has been actively investing in the digital industry in the last years, with a particular focus on decentralized finance (DeFi), non-fungible tokens (NFTs), layer 1 projects, and crypto companies.
Earlier this year, the firm was hit hard by the collapse of the Terra blockchain and the wider crypto market, with Bitcoin (BTC) falling below $20,000 for the first time in years. The downturn of the crypto market resulted in 3AC failing to meet margin calls — a situation where a lender seeks fresh capital to back a leveraged bet that is going bad — from BlockFi.
Following this news, several crypto exchanges — amongst which were FTX, BitMEX, and Derbit — were quick to liquidate 3AC’s positions from their platforms. Earlier this week, crypto exchange Voyager Digital also issued a notice of default to 3AC for failing to pay its loan of 15,250 BTC and 350 million USD Coin (USDC).
- The Chapter 11 filing estimates that Voyager had more than 100,000 creditors, and somewhere between $1 billion to $10 billion in assets.
- The company said the move was part of its reorganization plan, which ones implemented will give customers access to their accounts back, and “return value” to them.
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- Grant Thornton, Cryptopia’s assigned liquidator, announced it has applied for urgent interim relief in the Bankruptcy Court in the SDNY.
- Arizona-based company, which holds Cryptopia user data, is terminating services with the defunct exchange and is requesting $2 million in compensation.
- Grant Thornton, the liquidator assigned by Cryptopia, has announced the bad news.
- David Ruscoe, assigned to investigate the situation, added that, due to the complexities involved, the investigation could take “months rather than weeks”.