Financial news outlet Bloomberg has revealed that crypto investment company Three Arrows Capital (commonly known as 3AC) filed for Chapter 15 bankruptcy on Friday morning. Chapter 15 bankruptcy allows foreign and U.S. court systems to work together and is usually filed to safeguard the assets of the debtor.
Although the announcement isn’t a surprise, it puts an end to one of the world’s most notable, decade-old asset management firms.
Due to a lack of funds, a British Virgin Islands court ordered the fund to be liquidated on Wednesday. This was admonished on Thursday by the Monetary Authority of Singapore, which referred to Three Arrows as “misleading” and offering “wrong information.”
In the past, Three Arrows Capital was noted for its many investments in crypto-related businesses. Solana, Axie, and BlockFi are among the numerous initiatives and businesses that the firm has been involved with since it was created in 2012 by Su Zhu and Kyle Davies.
When Do Kwon’s algorithmic stablecoin UST destabilized and fell in value in May, the company suffered a loss of almost $200 million. There have subsequently been 3AC’s holdings liquidated by BitMEX, FTX, and Deribit.
Now the pressure is turning against other projects that have suspended withdrawals, are having money problems, and are suspected of going bankrupt as well, such as Celsius and Voyager.
Voyager Digital had already banned trading and withdrawals due to $646 million in overdue debts to Three Arrows. On Monday, Voyager served Three Arrows with a notice of default.