Key Takeaways
- • A British Virgin Islands court has ordered crypto hedge fund Three Arrows Capital to liquidate its assets, according to Politico, deepening stress across digital asset markets.
- • Two senior managing directors at global advisory firm Teneo will serve as joint liquidators of Three Arrows' assets, per a person with direct knowledge of the court order.
- • Three Arrows' $200 million investment in Luna, the token used to support the defunct algorithmic stablecoin TerraUSD, lost nearly all its value in the market downturn.
- • Digital asset markets have shed more than $2 trillion since last fall, erasing about two-thirds of the industry's total market capitalization.
- • The unwinding is expected to create significant difficulties for lending platforms and digital asset businesses whose finances are tied to Three Arrows' balance sheet.
Summary
A British Virgin Islands court has ordered Three Arrows Capital, one of the crypto industry's most prominent investment firms, to liquidate its assets, according to Politico. The order adds to a period of severe strain in digital asset markets, which are already contracting amid the collapse of several high-profile startups.
The unwinding of Three Arrows is expected to create significant problems for lending platforms and other digital asset businesses whose finances are linked to the fund's balance sheet. Digital asset markets have fallen by more than $2 trillion since last fall, erasing roughly two-thirds of the industry's total market capitalization, Politico reported.
Two senior managing directors from the global advisory firm Teneo will act as joint liquidators, a person with direct knowledge of the court order told Politico. Given the size of Three Arrows' holdings and current market volatility, the source said resolving the firm's obligations to creditors "is going to take a long time."
The firm's troubles stem in part from its $200 million investment in Luna, a crypto token whose value was used to support TerraUSD, an algorithmic stablecoin that has since collapsed. Luna lost nearly all its value during the market downturn, sharply eroding Three Arrows' fortunes.
The unwinding of Three Arrows is expected to create significant problems for lending platforms and other digital asset businesses whose finances are linked to the fund's balance sheet. Digital asset markets have fallen by more than $2 trillion since last fall, erasing roughly two-thirds of the industry's total market capitalization, Politico reported.
Two senior managing directors from the global advisory firm Teneo will act as joint liquidators, a person with direct knowledge of the court order told Politico. Given the size of Three Arrows' holdings and current market volatility, the source said resolving the firm's obligations to creditors "is going to take a long time."
The firm's troubles stem in part from its $200 million investment in Luna, a crypto token whose value was used to support TerraUSD, an algorithmic stablecoin that has since collapsed. Luna lost nearly all its value during the market downturn, sharply eroding Three Arrows' fortunes.
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