Crypto Hedge Fund Besieged Three Arrows Capital Files for Chapter 15 Bankruptcy Cryptocurrency
Struggling crypto hedge fund Three Arrows Capital Ltd., also known as 3AC, has filed for bankruptcy according to recent court filings. Court documents show that 3AC is seeking an ancillary Chapter 15 proceeding so that liquidators and creditors cannot seize the company’s US assets.
3AC Files for Bankruptcy – ‘Tremors’ from Crypto Market Crash ‘Keep Reverberating’ Says JPMorgan Analyst
Following reports that Three Arrows Capital Ltd. (3AC) was reprimanded by the Monetary Authority of Singapore (MAS) and faces liquidation in a court ruling from the British Virgin Islands (BVI), 3AC has reportedly filed for bankruptcy.
The court filings were seen by Bloomberg’s Jeremy Hill and the author posted a report which summed up the situation. Hill says 3AC has filed for Chapter 15 bankruptcy, which allows proceedings to take place and protects insolvent businesses in more than one country. Essentially, 3AC wants the bankruptcy to be recognized in the United States, in order to protect the assets of the hedge fund located in America.
“Representatives for Three Arrows filed the bankruptcy petition in New York on Friday, according to court documents,” Hill explained Friday. The law firm Latham and Watkins represents Three Arrows in the American bankruptcy [case]“, added the journalist.
3AC’s bankruptcy filing was filed in the Southern District of New York in Manhattan. 3AC’s main headquarters are in Singapore, but co-founder Su Zhu said last April that he planned to move to Dubai. Regarding the BVI court order against 3AC, the consulting firm Teneo manages the liquidation procedure in this jurisdiction.
According to JPMorgan analyst Nikolaos Panigirtzoglou, 3AC’s billion-dollar failure “suggests that the tremors of this year’s crypto market tumble continue to reverberate.” Panigirtzoglou continued to say in his investor note that there are many indicators pointing to deleveraged positions.
The JPMorgan executive added that “indicators like our net leverage metric suggest deleveraging is already well underway. The fact that crypto entities with the strongest balance sheets are currently stepping in to help contain the contagion.
3AC’s bankruptcy follows Voyager Digital’s suspension of withdrawals on Friday, alongside exchanges, deposits and loyalty rewards. Voyager’s debit card was also affected and Voyager customers are unable to use company-issued cards.
What do you think of 3AC’s bankruptcy filing? Let us know what you think about this topic in the comments section below.
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