Weekend: 3AC Submits for Bankruptcy, BlockFi and FTX Settle, Voyager’s Suspension
With the end of another week of severe crypto winter, a lot of significant news came to the front, giving additional clarity on the position of the majority of the prominent industry players like 3AC.
Bankruptcy Filing Submitted by 3AC
Initially, the distressed Three Arrows Capital (3AC) – a distressed hedge fund of cryptocurrency – is presently pursuing a shield from the creditors within the United States under the US Bankruptcy Code’s Chapter 15, which permits the debtors from foreign regions to protect the assets of the US, according to Reuters. Formerly this week, a court based in the British Virgin Islands declared a decree for the 3AC’s liquidation, as pointed out by the reports.
In the meantime, a stressed crypto lender named BlockFi stated that it sanctioned ultimate contracts, liable to shareholder authorization, with the US-based sub-branch of the crypto exchange FTX for a revolving credit service comprising USD 400M which is secondary to the entirety of the consumer funds, as well as, a facility to obtain BlockFi platform at an irregular price of nearly USD 240M per the performance triggers.
The Settlement between BlockFi and FTX US♦
Zac Prince and Flori Marquez – the co-founders of BlockFi – mentioned in their statement that they haven’t put a focus on the respective credit service up till now and have kept on running the entirety of their services and products in a normal way. Additionally, their interest rates have elevated to a great extent so much so that they are significantly operational at the moment. They acknowledged having witnessed losses of up to USD 80M because of the credit to 3AC.
In the meantime, another venue that underwent such a situation because of 3AC is Voyager Digital, stating that it is momentarily halting the loyalty rewards, withdrawals, deposits, as well as trading. The Voyager CEO – Stephen Ehrlich – disclosed that the respective decision provides them some more time to keep on delving into the systematic substitutes with diverse interesting entities while maintaining the Voyager venue’s value. He added that they will offer extra information when the right time comes.
The exposure of the firm to 3AC at present comprises almost BTC 15,250 (approximately USD 293) as well as USDC 350M, whereas they additionally became a part of a credit line contract consisting of several million with Alameda Ventures (known as a company centered around the quantitative trading as well as the FTX exchange’s parent firm). The position of FTX is that of the last resort for many crypto firms, and currently, Sam Bankman-Fried (the co-founder and CEO of the exchange) declared to be open to doing acquisitions as well as improving the mining of crypto.
