3AC liquidators are trying to secure Singapore assets of the hedge fund

Must read

Bored Apes, Moonbirds to feature on NFT-customized Mastercard debit cards

The customizable card will only support NFT avatars from select blue chip collections, subject to Mastercard’s design standards and an owner verification process....

Innovation will drive NFT adoption despite mainstream presence: NFTGo founder

The presence of global players may be viewed positively by the industry, but Tony Ling claims this does not impact mass adoption. ...

The path moving forward for ex-Ethereum miners remains unclear

It seems that some GPU owners have resorted to selling power to non-crypto projects following the Ethereum Merge. 1280 Total views...

Acala Network to resume operations after burning 2.7B in aUSD stablecoin

A total of 2.97 billion aUSD erroneously minted were recovered after the glitch. 650 Total views 12 Total shares...

3AC liquidators are trying to secure Singapore assets of the hedge fund 3AC liquidators are trying to secure Singapore assets of the hedge fund Monica Noronha · 16 hours ago · 2 min read

The 3AC liquidators have hired Singapore-based counsel to persuade the city-state’s High Court to recognize the BVI liquidation order.

2 min read

Updated: July 15, 2022 at 8:02 pm

3AC liquidators are trying to secure Singapore assets of the hedge fund

Cover art/illustration via CryptoSlate

The High Court of Singapore granted interim relief to the liquidators of Three Arrows Capital (3AC) on July 15 to investigate and preserve the assets of the insolvent crypto hedge fund in the city-state, The Straits Times reported.

Two employees of New York-based financial advisory firm Teneo were appointed by the British Virgin Islands (BVI) court as the joint liquidator for 3AC last month. The liquidators have hired Singapore-based law firm WongPartnership to plead the High Court to recognize  BVI’s liquidation order.

If the Singapore High Court recognizes the liquidation orders, the liquidators will be able to continue the liquidation process in the city-state. The recognition would also allow the liquidators to subpoena 3AC’s co-founders Su Zhu and Kyle Davies, whose locations are unknown since last week.

The High Court’s recognition would also go a long way in strengthening the position of the liquidators, helping them secure 3AC’s assets and meet its liabilities faster. WongPartnership lawyers may even argue in court that 3AC was mismanaged by Zhu and Davies, leading to the collapse, The Straits Times said.

Such an argument, if successful, can also lead to the seizure of the founders’ assets to the benefit of 3AC’s creditors.

The fall of 3AC

In March 2022, 3AC was managing around $10 billion in assets. Then in April, the price of Bitcoin and all other cryptocurrencies started falling, which was accelerated by the collapse of the Terra ecosystem in May.

Rumors about 3AC’s insolvency started surfacing around mid-June, when the hedge fund started selling large positions, including $40 million in Lido staked Ethereum (stETH). Crypto traders and analysts surmised that the sale was an attempt to keep large loans on Aave and Compound from being liquidated.

The Financial Times reported that 3AC had failed to meet margin calls on loans and was liquidated by Genesis and BlockFi. Then crypto lender Voyager Digital served 3AC with a notice of default for failing to repay around $650 million.

On June 30, a BVI court ordered the liquidation of 3AC. The hedge fund filed for Chapter 15 bankruptcy on July 1 to try and protect the firm’s U.S. assets while the liquidation took place in BVI.

Voyager Digital, despite the lifeline it had secured from Alameda Research, filed for Chapter 11 bankruptcy on July 5, owing to its exposure to 3AC. According to a Reuters report, crypto exchange Blockchain.com stands to lose $270 million on its loan to 3AC.

More articles

Latest article

Bored Apes, Moonbirds to feature on NFT-customized Mastercard debit cards

The customizable card will only support NFT avatars from select blue chip collections, subject to Mastercard’s design standards and an owner verification process....

Innovation will drive NFT adoption despite mainstream presence: NFTGo founder

The presence of global players may be viewed positively by the industry, but Tony Ling claims this does not impact mass adoption. ...

The path moving forward for ex-Ethereum miners remains unclear

It seems that some GPU owners have resorted to selling power to non-crypto projects following the Ethereum Merge. 1280 Total views...

Acala Network to resume operations after burning 2.7B in aUSD stablecoin

A total of 2.97 billion aUSD erroneously minted were recovered after the glitch. 650 Total views 12 Total shares...

California files order against Nexo interest account, says it’s 8th state to take action

The state Department of Financial Protection & Innovation says the crypto-interest account is an unqualified security; Nexo has limited the accounts since the...