Three Arrows Capital drowns many crypto companies in the market.
The market crash of May 2022, had a serious affect on the crypto currency market. But as the market crash prolongs, many companies are filing for bankruptcy or are going involvement. The current condition of market is pitiful and is filled with sorrow. The hedge fund company Three Arrows Capital, is one of the most affected companies in the market that has suffered massive blows by the market crash.
3AC held a massive worth of amount in Terra’s USD. As Terra USD and its sister token Luna, collapsed, the value for 3AC also started going down. The value went so further down that, the company became incapable of clearing the loans that it made with huge crypto institutions, and also became one of the main reasons to drown them down in the market.
Companies such as Voyager, BlockFi have all been affected adversely by 3AC’s market situation. BlockFi went on to suspend its activities and is in process of acquisition by FTX. Voyager Digital also filed for Chapter 11 Bankruptcy as the market situation for the crypto lending company gets worse. Among such companies, Blockchain.com also got hit massively by 3AC’s bankruptcy filing.
According to a person with knowledge of the situation, Blockchain.com, a cryptocurrency exchange, could lose $270 million on its loans to the insolvent crypto hedge fund Three Arrows Capital (3AC). After one of the most prominent blow-ups of the crypto crisis this year, 3AC filed for Chapter 15 bankruptcy a few days prior, seeking protection from creditors in the United States.
According to a business spokeswoman, Blockchain.com CEO Peter Smith stated in a letter to shareholders that “Three Arrows is swiftly going insolvent and the default impact is about $270 million worth of bitcoin and U.S. dollar loans from Blockchain.com.”
Genesis Trading, a crypto currency exchange, also disclosed earlier this week that it had exposure to 3AC but has reduced its losses as a result of the hedge fund’s failure to pay a margin call.
According to me, the situation that 3AC is miserable and the part that adds more to the misery is that, the company has loans from major reputed companies. 3AC is playing a major role in bringing these companies down. The current market situation does not look good and as the day passes by, a new company’s link with 3AC and its misery associated with it is brought into light.
Only few companies are attempting to revive back the market such as FTX and Binance. The entire market is now dependent on these companies and performance of these companies will certainly help the market revive.