Three Arrows Capital (3AC) Cryptocurrency Hedge Fund deposit for Chapter 15 bankruptcy in an effort to protect its U.S. assets from creditors in the country, as previously reported by Bloomberg and CNBC. On Friday, representatives of the Singapore-based company filed the case in a court in the Southern District of New York, which legally protects US assets of insolvent foreign debtors with US creditors.
Founded in 2012 by Kyle Davis and Su Zhu, 3AC managed about $10 billion in assets as recently as Marchflowing later to $3 billion in April. Like several other crypto firms, including lending giants Celcius and Babel Finance, 3AC’s turnaround in fortunes is part of the so-called crypto “winter” that has taken stablecoins down and the value of Bitcoin plummeted.
Earlier this week, reports emerged that 3AC defaulted on $670 million loan provided by crypto broker Voyager Digital, which has since halted all transactions, deposits and withdrawals Therefore. Sky News reported later that a court in the British Virgin Islands ordered 3AC to be liquidated and that the company would work with business consultancy firm Teneo to oversee the process.
In May, Davies and Zhu admitted in an interview with the WSJ that the company lost an investment of $200 million as a result the crash of Luna and its sister coin TerraUSD. At the time, the two remained optimistic about the prospects for crypto, telling the WSJ that they have “always been believers in crypto” and “still are”.