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Prominent crypto hedge fund’s tweet stokes fears over insolvency amid market turmoil

SinceThe beginning of MayTwo high-profile crashes had already rocked cryptocurrency markets, which agitated an asset type already under pressure due to tighter monetary policies.

AnA cryptic tweet from one of the founders of has given an unsettling sector a boost of anxiety. Three Arrows Capital(3ac), a prominent Hedge Fund that has been liquidating cryptocurrency holdings in response to falling prices.

Zhu Su, a former trader with Credit Suisse GroupAG, co-founder of 3ac tweeted from his verified Twitter account June 15:

“We are in the process of communicating with relevant parties and fully committed to working this out.” 

ItIt is notable that prominent names in cryptocurrency have expressed their support in the comments section. They are grateful for what the fund has done in the space.

Prominent crypto hedge fund's tweet stokes fears over insolvency amid market turmoil 3

NeverthelessRumours that the hedge fund will soon be insolvent are still being circulated. This is a shocking development considering it is one the largest cryptocurrency hedge funds in existence.

3ac is estimated to have $10 Billion in assets

TheBlockchain analytics company NansenEstimated at beginning of MarchThat Three Arrows handled around $10 billion in assets, despite the fact that information on the fund’s size and trading strategies were limited.

AccordingAccess the most recent regulatory filings available as of December2020, it controlled more than 5% of the Grayscale Bitcoin TrustIt is not known if it is. Three Arrowshe has maintained this position. 

Crypto market collapse

SinceThe beginning of MayTwo major collapses had already rocked cryptocurrency markets. Analgorithmic stablecoin, which was an integral component of the Terraform Labs’ stablecoin TerraUSD (UST) decentralized financial ecosystem first failed when it became decoupled from its dollar peg, which contributed to the collapse of the network. 

A little more than a month later, a cryptocurrency loan provider appeared Celsius blocked withdrawals on a platform where it promised high profits, claiming the need to “stabilize liquidity.” RecentDiscussions around Three Arrows have focussed on the company’s potential exposure to a cryptocurrency known as staked EtherSometimes abbreviated as “stETH” 

In FebruaryA one-billion dollar sale of the LUNA cryptocurrency was made. Three ArrowsHe was one of the investors. WhenThe dollar peg of TerraUSD stablecoin was broken May, practically all of the value of the native token LUNA, which is the stablecoin’s sister token, was lost.

Disclaimer: TheThe content of this site should not serve as investment advice. InvestingIt is speculative. WhenYour capital is at high risk when you invest.


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