Crypto hedge fund Three Arrows Capital (3AC) has filed for Chapter 15 bankruptcy in New York, according to a Bloomberg report.
The mega fund, founded by Credit Suisse traders Zhu Su and Kyle Davies, once managed about $10 billion in assets and was a focal point among crypto-finance players. Its insolvency forced major players in the industry to realign operations and limit customer withdrawals amid a cryptocurrency selloff that seemed to catch many large firms off guard.
Chapter 15 bankruptcy will allow the foreign company to protect its state assets while liquidation is carried out in the British Virgin Islands following a court order this week after 3AC defaulted on a $660 million loan to Voyager Digital. 3AC is based in Singapore.
The company’s further collapse is causing trouble for many corporate-backed cryptocurrency enthusiasts. Earlier today, BlockFi announced a deal with FTX US and noted that it lost around $80 million due to deals with 3AC.