Deribit claims that the crypto hedge fund Three Arrow could not repay $ 80 million

Three Arrows Capital was liquidated this week after the Deribit stock exchange claimed that the crypto hedge fund did not repaid $ 80 million, which clarified the severity of the crisis at the leading investment company for digital assets.

The investor supposedly failed to refund the funds after the derivative place Deribit had dissolved the positions of Three Arrows to fulfill a margin Call that was triggered by the turbulence at the market for digital assets last month, as was the result of court files on the British maiden islands.

The claims underline the extent to which Three used Arrows loans to increase its bets on the cryptocurrency market. Blockfi and Genesis, two large crypto finance service groups, had also liquidated some of the positions of Three Arrows last month after the company had not met the additional claims when its bets became angry.

Three Arrows was one of the most active players in the broader industry and a shareholder from Deribit. The investment group's problems have tightened the credit crisis on the market for digital assets.

The court documents submitted by Deribit claim that Three Arrows had borrowed from the appointment exchange in the middle of pandemic in the middle of pandemic. On June 11, 2022, when the prices for cryptocurrencies collapsed, Three Arrows violated the credit agreement from Deribit to have a minimum credit on his account.

Two days later, Deribit began to liquidate the positions of Three Arrows on June 15, terminated the loan contract and requested payments of the outstanding loans, interest and the negative value value of the account, according to the court documents.

On June 20, this was $ 80.13 million, as the documents showed. This mainly consisted of 1,300 Bitcoin and 15,000 Ether in the loan worth around $ 42 million and negative assets of $ 37.1 million.

Deribit urged the liquidation of Three Arrows, since "the company cannot pay for its debts at the due date or will likely become and is therefore insolvent," says the court file.

The consulting company Teneo was appointed the common liquidator of Three Arrows on the British Virgin Islands at the beginning of this week after the claims.

Three Arrows and Deribit did not answer inquiries about comments. Deribit tweeted last month that due to "market developments" it has a "small number of accounts that have net debt with us, which we consider potentially necessary". Su Zhu, co -founder of Three Arrows, tweeted in June that "we are in the process of communicating with relevant parties and fully committed to clarifying this".

Three Arrows is also checked by the Singapore financial supervisory authority, which the fund has complained about at the beginning of this week due to the provision of misleading information and for exceeding an asset under management threshold. The monetary authority of Singapore said that it examined the fund that was originally managed by the city state before it was moved to the British Virgin Islands in September 2021.