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Three Arrows Capital Hedge Fund in Default Amid Crypto Selloff

Three Arrows Capital (3AC) – a prominent hedge fund based in Singapore that deals in crypto – has defaulted on a loan worth more than $670 million, broker Voyager Digital says


Lender Voyager Digital has filed for bankruptcy amid the crypto crash and a week after issuing a default notice to Three Arrows Capital.
Chapter 11 bankruptcy procedures put a hold on all civil litigation matters and allow companies to prepare turnaround plans while remaining operational. File photo: Reuters.

 

Three Arrows Capital (3AC), a prominent hedge fund based in Singapore that deals in cryptocurrency, has defaulted on a loan worth more than $670 million.

Crypto broker Voyager Digital issued a notice of default on Monday, saying the 3AC fund had failed to make required payments on a loan of 15,250 bitcoin (about $324 million) and $350 million worth of the USDC stablecoin.

Voyager said it intended to pursue recovery from 3AC and was in discussions with its legal advisors in regard to possible legal remedies.

It is exploring options including a sale of assets and a bailout by another firm, the Wall Street Journal reported last week. 

The latest news is symptomatic of the turmoil that has rocked the crypto sector since the collapse of the TerraUSD stablecoin last month.

Singapore-based 3AC is one of the higher profile crypto companies to have run into difficulties following the market selloff, which has seen the overall crypto market cap drop to about $950 billion – a third of its peak of around $3 trillion last November. 

3AC did not immediately respond to a request for comment.

Voyager said on Monday that it continues to operate and fulfil customer orders and withdrawals, though a statement on the company’s website last week said it had lowered its daily withdrawal limits to $10,000 from $25,000. 

Voyager said in Monday’s statement it had accessed US$75 million of a revolving line of credit previously made available by VC fund Alameda Ventures. 

Almeda, which is FTX founder Sam Bankman-Fried’s quantitative trading firm, has offered Voyager a US$200 million cash and USDC revolver and a 15,000 BTC revolver.

 

• Reuters with additional editing by Jim Pollard

 

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Jim Pollard

Jim Pollard is an Australian journalist based in Thailand since 1999. He worked for News Ltd papers in Sydney, Perth, London and Melbourne before travelling through SE Asia in the late 90s. He was a senior editor at The Nation for 17+ years and has a family in Bangkok.

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