Blockchain.com Loses $270M in 3AC Chaos

Key Takeaways

  • Blockchain.com has misplaced $270 million to Three Arrows Capital, in line with a letter despatched to shareholders two weeks in the past.
  • However the agency stays “liquid” and “solvent,” the CEO mentioned earlier than assuring prospects wouldn’t be impacted by the loss.
  • Blockchain.com numbers among the many entities wanting to carry Three Arrows Capital “totally accountable” for “defrauding” the crypto business.

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Three Arrows Capital owes $270 million to crypto lending platform Blockchain.com, although the CEO has insisted in a letter to shareholders that the corporate stays liquid and prospects wouldn’t be impacted.

3AC “Defrauded the Crypto Business”

It seems Blockchain.com has additionally misplaced cash to Three Arrows Capital.

The agency introduced in a letter despatched to its shareholders two weeks in the past that Blockchain.com would endure a $270 million loss ought to the infamous crypto hedge fund default on its obligations.

The corporate “stays liquid, solvent and our prospects won’t be impacted,” Blockchain.com CEO Peter Smith wrote within the letter. He additional elaborated that Three Arrows Capital had transacted with the agency for over $700 million in crypto and U.S. {dollars} during the last 4 years.

Blockchain.com is a crypto buying and selling platform that additionally gives lending and custody companies for companies and institutional purchasers. Three Arrows Capital is a outstanding crypto hedge fund; its founders, Su Zhu and Kyle Davies, turned well-known within the crypto house for his or her prescient buying and selling calls and for pushing the “supercycle” principle, arguing that Bitcoin would by no means face one other 80% downturn. 

The agency was worn out following the brutal market meltdown, inflicting a liquidity disaster for his or her many “CeFi” counterparties, that are centralized corporations that leverage for his or her prospects the alternatives present in decentralized finance (DeFi) protocols. Celsius, BlockFi, and Voyager are among the many companies having suffered heavy losses from Three Arrows Capital’s insolvency.

A courtroom within the British Virgin Islands has ordered the liquidation of the crypto hedge fund, a transfer reportedly supported by Smith, who mentioned Three Arrows Capital had “defrauded the crypto business.” Smith acknowledged that Blockchain.com intends to “maintain them accountable to the fullest extent of the legislation.”

Disclosure: On the time of writing, the writer of this piece owned ETH and several other different cryptocurrencies.

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