News hardware Bitcoin: the crisis makes a new victim…
The crypto giants continue to tumble with the fall of Bitcoin… After the announcements of massive layoffs from cryptocurrency platforms, it is the turn of professional investors to jump ship.
Three Arrows Capital (3AC) in bankruptcy
As several bankruptcy rumors swirled around the cryptosphere, the British Virgin Islands-based investment firm confirmed the news. The cryptocurrency investment fund Three Arrows Capital, more commonly known as 3AC, filed for bankruptcy on Friday July 1, according to the economy magazine Bloomberg.
Bad news for the cryptosphere since the company founded in 2012 was one of the biggest companies bringing liquidity to the market with an estimate of nearly $9.56 billion invested in March according to Nansen, a blockchain analysis platform. .
3AC was particularly known for having invested in many successful crypto projects such as:
- Axie Infinity
By bringing a lot of money to these cryptocurrencies, the fund has actively participated in the rise in their prices.
The news of the bankruptcy filing comes as Three Arrows Capital had just been put on hold over unpaid loans for a Voyager Digital, amounting to 617 million euros.
The company has racked up immense losses due to the bearish trend in Bitcoin and cryptocurrencies. Highly exposed to Terra, it notably lost around 191 million euros during the famous crash of the Luna cryptocurrency and its algorithmic stablecoin UST. The supposedly stable cryptocurrency (that is to say, normally expected to be backed by the dollar) saw its price of 1 dollar unscrew to 0, leading investors to exceptional losses.
Its huge debts led to the liquidation of this cryptocurrency giant, direct consequences were observed in the price of Bitcoin in the following hours and days.
The first to have liquidated their assets with the investment fund are also giants in the sector: BitMEX, FTX and Deribit.
The consequences of the fall of Bitcoin and cryptocurrencies
This is not very reassuring news for the world of cryptocurrencies, which sees major market players give up their arms every day because of the decline of recent months. Indeed, this collapse of certain giants does not bode well for other platforms and market players who are also experiencing difficulties in this context of decline.
For example: Celsius, a cryptocurrency lending company currently in debt for more or less similar reasons, could also suffer the same fate in the coming months if no company decides to buy back the company’s losses .
The loss of confidence in its market participants could create a chain reaction, involving yet another drop in Bitcoin.