In the Three Arrows Capital liquidation saga, the WSJ reports that the investment firm is exploring options, including asset sales and a bailout by another firm.
Su Zhu and Kyle Davies founded the crypto hedge fund, which has hired legal and financial advisers to help it find a solution for its investors and lenders.
As reported earlier, the crypto lending firm Celsius Network will not be bailed out by its investors, and then we learned about BlockFi, one of the largest crypto financial services groups that liquidated some of Three Arrows’ positions.
After 3AC failed to meet margin calls, the founders confirmed that they had suffered significant losses in the recent market downturn because of an investment of approximately $200 million in Luna.
That investment was effectively wiped out when TerraUSD and Luna both became worthless in a matter of days.
“The Terra-Luna situation caught us very much off guard,” Davies said, adding that they are committed to working things out and finding an equitable solution.
3AC was also known to have large positions in Grayscale Bitcoin Trust (GBTC), an institutional bitcoin product, as well as staked ether (stETH) tokens.
Three Arrows is also still attempting to quantify its losses and value its illiquid assets, which include venture capital investments in dozens of private cryptocurrency-related companies and startups, according to Davies.
