Three Arrows Capital, focused on cryptocurrency hedge funds, has sunk into liquidation, deepening the crisis that is engulfing the global digital asset sector.
Sky News has learned that Teneo partners in the British Virgin Islands have been lined up to deal with the bankruptcy of the Singapore-based company, which was founded in 2012 by Su Ju and Kyle Davis.
Cryptocurrency insiders said Wednesday that liquidation will be an important moment in the current collapse of the cryptocurrency sector, which has grown at breakneck speed in recent years.
It was not clear what the immediate financial consequences would be for the creditors of Three Arrows.
The company’s demise is likely to raise additional questions about the regulatory oversight of cryptocurrencies and other digital assets in major global financial centers.
The crisis at Three Arrows Capital was highlighted earlier this month when Voyager Digital, a crypto broker, said it was considering issuing a default notice for a hundreds of millions of dollar loan.
The crypto landscape is experiencing rapid changes amid a collapse in the valuation of assets such as stablecoins – digital currencies linked to the value of assets such as the US dollar or gold.
Mr Davis told the Wall Street Journal in an interview this month that he was “committed to working things out and finding a fair solution for all our voters”.
He added that Three Arrows was exploring options such as selling assets or rescuing another company.
It is unclear whether similar talks continue on Wednesday, or whether some form of sale of Three Arrows’ assets by its liquidators remains possible.
A person familiar with the situation confirmed that a court order was issued on June 27 in BVI to liquidate the Three Arrows.
Three Arrows Capital did not respond to an email request for comment while Teneo was contacted for comment.
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