After Celsius, crypto investment fund Three Arrow Capital in turn in big trouble

This Wednesday, the crypto ecosystem has its eyes fixed on this investment fund which manages 10 billion dollars. The question of his insolvency is raised.

The ether-staked lido (stETH) continues to claim new victims. After the loan platform Celsius, which hired lawyers to restructure, it is the turn of the Singaporean investment fund Three Arrow Capital (3AC) to be in bad shape.

Founded in 2012, 3AC is one of the largest investors in the crypto ecosystem, managing $10 billion. The fund has invested in blockchains like Bitcoin, Ethereum and Terra, which collapsed a month ago. The fund had also potted in decentralized finance (DeFi) protocols like Aave and Lido, the primary platform where users can deposit stETH in exchange for interest.

In a context where the crypto ecosystem is in the red, the question of the insolvency of this investment fund has been raised.

“The fund is finding a way to repay lenders and other counterparties after being liquidated by leading lenders in this space,” The Block reported on Wednesday. “Three people said the liquidation amounted to at least $400 million. They added that the company has maintained limited contact with its counterparties since its liquidation,” the outlet added.

Separately, 3AC “has established the community’s attention over the past few weeks with the way they’ve managed their position in stETH,” Andrew Thurman, an analyst at Nansen, told Reuters on Tuesday. CoinDesk. According to the latter, the company withdrew nearly 400 million stETH and ether from the Curve decentralized finance protocol in May. Similarly, one of the company’s wallets allegedly withdrew 80,000 stETH from the Aave protocol on Tuesday and converted 38,900 stETH (around $45 million) in two transactions.

This Wednesday, Zhu Su, one of the founders of 3AC, posted a sobering message, indicating that his company was in the process of communicating with some “appropriate parties”. No further information has been given at this stage.

Losses that accumulate

As a reminder, on Monday, the American cryptocurrency lending and staking platform Celsius, which has 1.7 million customers and claims approximately $12 billion in assets under management, announced that it would no longer allow its customers to withdraw or transfer their cryptocurrency funds.

It was caught in the turmoil after some analysts warned that some companies, which are exposed to stEth, including the latter, could risk default if their users withdrew a lot of ether amid stress. .

The situation could be even more complicated for A3C, which was seriously weakened during the last crypto-crash. According to information from Cointelegraph3AC had traded around $500 million worth of bitcoins with the Luna Foundation (of the Terra blockchain) a few weeks before its collapse.

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