3AC liquidators are trying to secure Singapore assets of the hedge fund
The Singapore High Court provided provisional relief to Three Arrows Capital (3AC) liquidators on July 15, investigating and preserving the assets of unresolved crypto hedge funds in city-states. The Straits Times report..
Two employees of New York-based financial advisory firm Teneo were appointed by the British Virgin Islands (BVI) Court as co-liquidators of 3AC last month. The liquidator hired a Singapore-based law firm, Wong Partnership, and appealed to the High Court to approve the BVI liquidation order.
If the Singapore High Court approves the liquidation order, the liquidator can continue the liquidation process in the city-state. With this approval, the liquidator can also summon 3AC co-founders SuZhu and Kyle Davies. These locations have been unknown since last week.
High Court approval will greatly help to strengthen the liquidator’s position, secure 3AC’s assets and fulfill its liabilities more quickly. According to The Straits Times, Wong Partnership lawyers may even argue in court that 3AC was mismanaged by Zhu and Davies, leading to its collapse.
If such an argument is successful, it could lead to the seizure of the founder’s assets for the benefit of 3AC creditors.
Autumn of 3AC
In March 2022, 3AC managed assets of approximately $ 10 billion. Then, in April, the prices of Bitcoin and all other cryptocurrencies began to fall. This was accelerated by the collapse of the Terra ecosystem in May.
Rumors about 3AC’s bankruptcy began to surface around mid-June when hedge funds began selling large positions, including $ 40 million in Lido Stake Ethereum (stETH). Cryptographic traders and analysts speculated that the sale was an attempt to prevent large loans to Aave and Compound from being liquidated.
Financial Times report The 3AC was unable to respond to the loan margin claim and was liquidated by Genesis and BlockFi. Later, cryptocurrency lender Voyager Digital failed to repay about $ 650 million and provided 3AC with a default notice.
On June 30, the BVI Court ordered the liquidation of 3AC. The hedge fund filed for Chapter 15 Bankruptcy on July 1st to protect the company’s US assets while liquidating at the BVI.
Voyager Digital filed for Chapter 11 Bankruptcy on July 5 because it was exposed to 3AC despite a lifeline secured by Alameda Research.According to Reuters reportCryptocurrency exchange Blockchain.com will lose $ 270 million in a loan to 3AC.
