A new report claims that facing the prospect of a protracted legal battle with creditors, troubled Three Arrows Capital has moved a large number of stablecoins to KuCoin.
PeckShield, a blockchain security and analytics company, revealed The company that embroiled Three Arrows Capital (3AC) transferred a large portion of its crypto holdings to the KuCoin exchange. The assets include $20 million in USD Coin (USDC) and $10 million in Tether (USDT).
Another 20 million USDT appears to have been transferred to KuCoin and analysts are scratching their heads over the reason for the move. On Twitter, there is speculation that 3AC is gearing up for a mega-trade to make up for the losses it has suffered over the past few weeks.
Chapter 15. three arrow files for
The decision to move stablecoins comes on the heels of a 3AC filing for Chapter 15 bankruptcy protection in the US. The filing seeks to protect hedge fund assets in the country during the liquidation process.
In late June, a British Virgin Islands court ordered the liquidation of 3AC after it defaulted on a large portion of its loans. The court appointed two senior members from the advisory firm Teneo to handle the liquidation.
Hefty fines were imposed by the Monetary Authority of Singapore (MAS) for failing to notify the hedge fund of changes in shareholding status and for making misleading statements about the size of the company’s assets.
long list of creditors
Three Arrows Capital’s crisis began after the TeraUSD (UST) stablecoin depreciated from the US dollar. The firm had previously bought Luna Foundation Guards (LFG) in November for $200 million worth of growth, and a steep drop in asset prices did little to help the hedge fund’s cause.
The firm defaulted on a $670 million loan to Voyager Digital, while BlockFi was forced to cancel its $400 million loan to the hedge fund. BlockFi CEO Zac Prince said, “BlockFi can confirm that we have exercised our best business judgment recently with a large client that failed to meet its obligations on an over-collateralized margin loan. Used to be.”
Other creditors include Deribit and Blockchain.com, with the latter vowing to “hold”. [3AC] accountable to the fullest extent of the law.” Analysts warn that market participants should prepare themselves for the ripple effects of 3AC’s collapse as the infection spreads through the ecosystem.