According to prior reports from Bloomberg and CNBC, cryptocurrency hedge firm Three Arrows Capital (3AC) filed for Chapter 15 bankruptcy in an effort to shield its US assets from foreign creditors. The application was submitted by representatives of the Singapore-based firm on Friday before a court in the Southern District of New York, which has the authority to legally shield US assets of bankrupt 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 sinking to $3 billion in April. Like several other crypto firms, including the lending giants Celcius and Babel Finance, 3AC’s turn in fortunes is part of the so-called crypto “winter” that’s brought down stablecoins and sent Bitcoin’s value plunging.
Earlier this week, reports emerged that 3AC failed to pay a $670 million loan provided by crypto broker Voyager Digital, which has since halted all trades, deposits, and withdrawals as a result. Sky News later reported that a court in the British Virgin Islands has ordered 3AC’s liquidation and that the firm is reportedly working with business consulting company Teneo to oversee the process.
In May, Davies and Zhu admitted in an interview with the WSJ that the company lost out on a $200 million investment following the crash of Luna and its sister coin TerraUSD. At the time, the two remained optimistic about the prospects of crypto, telling the WSJ that they’ve “always been crypto believers” and “still are.”
About Author
