The troubles of the cryptocurrency lending company Three Arrows Capital seem to be unstoppable. Three Arrows Capital (3AC) received a default notification from Voyager Digital after rumors circulated on the Internet. This notice concerns the failure to repay debt totaling more than $ 650 million. Voyager Digital is a cryptographic application that claims a profit of up to 12%.
The official announcement was made on Monday. According to the statement, 3AC has a debt of 15,250 BTC (Bitcoin worth $ 325 million) and 350 USDC to Voyager Digital. Voyager Digital states that it is still open. The company is still executing customer orders and withdrawals. This is in contrast to some other crypto exchanges that were exposed to 3AC and had to shut down their drawers.
Voyager has accessed the $ 75 million credit line set up by Alameda Research. The company states that it may use more if needed.
Stephen Ehrlich, CEO of Voyager Digital, said in a statement:
“We are enthusiastic and swift to strengthen our balance sheet and pursue options to continue to meet our clients’ liquidity demands.”
We hired Moelis & Company as a financial consultant during this process.
This month, the investment held by Singapore-based 3AC was liquidated because it failed to meet the margin requirements. Former classmates Su Zhu and Kyle Davies founded a crypto fund in 2012. As a result of the collapse of the Terra crypto ecosystem and its native token (Luna) last month, the company is currently facing significant losses.
According to Davis, Three Arrows Capital hired legal and financial counsel to find solutions for investors and creditors after suffering significant losses as a result of the sale of digital assets to the global market. ..
Davies claims that Three Arrows Capital is investigating options such as asset sales and savings by another company. The fund attempts to enter into a contract with a creditor to buy more time to make a plan. The business is still running while looking for a solution.
But nothing is said about where the plan is. Moreover, Zhu was surprisingly silent during this uncertain period. His last tweet was published on June 15th.
3AC was one of many companies affected by the end of the Terra (LUNA) blockchain. This shows how vulnerable many of today’s systems were. However, it does provide valuable lessons for future businesses, investors, and projects.