Three Arrows Capital filed for bankruptcy
The Singapore’s hedge fund failed to repay a $ 660 million loan.
World's largest crypto hedge fund Three Arrows Capital (3AC) has filed for Chapter 15 bankruptcy under the US jurisdiction of New York.
The indiscretion that has been circulating for days has been made official by Bloomberg which reports that the hedge fund has defaulted on a loan of $ 660 million to cryptocurrency investment firm Voyager Digital, which has been forced to block withdrawals due to lack of liquidity. Specifically, Voyager Digital had asked Three Arrows Capital to redeem USDC 25 million by June 24. After this deadline expired, he requested the repayment of the entire loan - 15,250 BTC and $350 million USDC.
The inability to repay this debt has led Three Arrows Capital to file for bankruptcy, in order to take advantage of the rules contained in the so-called chapter 15 on bankruptcy. Chapter 15 of the US bankruptcy jurisdiction sets in motion effective mechanisms for dealing with insolvency cases involving debtors, assets, plaintiffs and other interested parties in multiple countries. In this way, Three Arrows Capital – which has been also reprimanded by Singapore's monetary authority – will be able to protect its interests in the US, while the entire bankruptcy process will be handled by a court of the British Virgin Islands.