Cryptocurrency Hedge Fund Three Arrows Capital Went Bust
Three Arrows Capital, the Singapore-based cryptocurrency hedge fund, filed for Chapter 15 bankruptcy, attempting to protect its US assets from creditors in the country.
The filing was made in a Southern District New York Court on Friday.
In the corresponding document, it is stated that “The Debtor’s [Three Arrows Capital] business has collapsed in the wake of extreme fluctuations in the cryptocurrency market”, adding that “the Debtor’s financial distress and the BVI Proceeding [the company was ordered to liquidate on 27 June 2022 by a court in the British Virgin Islands] have been widely reported and the result of the Proceeding’s implications on the global digital asset markets.”
In the past weeks, the cryptocurrency market has experienced a further downfall, with the Bitcoin price plunging over 11%. The coin is trading at just over $18,000 press-time.
BTC’s chief competitor ETH is likewise showing a feeble performance, trading at $1,055.95.
Founded in 2012 by Kyle Davis and Su Zhu, in March, Three Arrows Capital managed close to $10 billion. Already in April, the pool shrank to $3 billion.
The Singaporean hedge fund is the latest project losing ground as a result of the ongoing cryptowinter. Other initiatives like TerraUSD have likewise crumbled, with the company attempting to revamp itself, calling the new chain Terra (token Luna - LUNA).
Celsius, a cryptocurrency loan company headquartered in New Jersey, is also experiencing financial turmoil, despite continuing to provide crypto rewards to its customers – a behavior that some users have found to be bizarre.
To remind, three weeks ago the platform put the payments to a halt, citing "extreme market conditions," sparking rumors about its financial well-being and solvency. It has also recently laid off 150 employees, which make up a quarter of its working force.