Failing crypto hedge fund Three Arrows Capital has finally fallen into liquidation. Teneo Restructuring has been brought in to facilitate the liquidation process.
Following on from the Terra Luna debacle, and one of the first dominos to fall, given the exposure it had to it, Three Arrows Capital has finally entered into liquidation.
The contagion has since spread even further, and other crypto platforms are also on the brink. Voyager Digital is currently undergoing liquidity problems after Three Arrows Capital defaulted on a $670 million loan from Voyager.
Sam Bankman-Fried has given Voyager a credit line so that it can honour its commitments, and has also extended this to BlockFi, another under-risk platform with links to Three Arrows Capital.
According to an article on CNBC, Teneo has been called in to oversee the liquidation process, although there has been no official confirmation of this from Three Arrows Capital or Teneo as yet.
The article goes on to say that Teneo will be taking stock of the Three Arrows Capital assets, and will then set up a website in the next day or so, detailing how creditors can get in touch and start their claims applications.
As reported in the Financial Times, both BlockFi and Genesis liquidated some of the Three Arrows positions by taking the collateral it had put down in order to back its borrowing.
The liquidation of Three Arrows is bound to have a negative effect on an already unsteady crypto sector that is seeing bitcoin trying to stay above the all-important $20,000 price level, while most altcoins are faring a lot worse.
As already reported by Crypto Daily, the lack of liquidity contagion has been felt by crypto lender Celsius, which has frozen investor assets on its platform for the last couple of weeks. The lender is currently debating the choice of bankruptcy, or a rescue package from Simon Dixon and Bank to the Future.
Crypto exchange CoinFlex is yet another platform in some difficulty. It is rumoured that Roger Ver is the counterparty who has defaulted on his debt, and owes the platform $47 million. Mr Ver has denied the claim.
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