Kyle Davies, one co-founder of Three Arrows CAPITAL (3AC), said that the crypto hedge funds are exploring other options, including asset sales and getting rescued or rescued by another company. This comes after some top crypto exchanges liquated the firm’s leveraged positions.
Three Arrows Capital has grown over the years to be one of the most prominent crypto-focused hedge funds. However, it has been experiencing difficulties since the Terra (LUNA) scandal a month ago.
Liquidation 3AC positions
Bitmex and Deribit have already liquidated Three Arrows Capital Leveraged Positions.
Three Arrows’ co-founders stayed mum on the fate, but Davies talked about the difficult situation the firm was in during an interview with Wall Street Journal.
During the interview Davies said that the firm suffered losses following the fall of TerraUSD and Terra (LUNA), currently LUNA Classic. Three Arrow Capital, along with other investors, had participated in the Luna Foundation Guard’s $1 billion token sale. Three Arrow Capital had contributed $200 million to the token sale.
“The Terra-Luna situation caught us very much off guard.”
The 2AC-long crypto positions are also being affected by the Terra (LUNA?) debacle.
Davies offered this solution to the problem:
“This has pushed 3AC into looking for desperate options, including asset sale and a rescue by another firm.”
However, he quickly pointed out that they were not the only ones to be affected by this current situation and that other businesses have also been affected.