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Highlights
- Three Arrows Capital reportedly sold Lido's stake Ether (stETH) for around US$ 40 million.
- 3AC crypto hedge fund is believed to be one of the most successful cryptocurrency hedge funds.
- Su Zhu sent a cryptic tweet, implying that Three Arrows Capital was looking to fix a problem.
As the cryptocurrency market continues to crash, some reports of a crypto-focused hedge fund going bankrupt have sent shock waves among crypto enthusiasts. On Tuesday, it was reported that Singapore-based Three Arrows Capital (3AC) could have become insolvent and might become the latest victim of the bear market.
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Three Arrows Capital reportedly sold Lido's stake Ether (stETH) for around US$ 40 million and is most likely the top seller of stETH in the last week.
Crypto enthusiasts have been monitoring stETH, which used to trade at par with ETH. However, that began to alter in May, and its de-peg in June has allowed ETH bulls and has kept cryptocurrency's largest holders under stress.
What's next for the 3AC crypto fund?
Su Zhu, the co-founder of Three Arrows Capital, has addressed the reports claiming that the firm may be experiencing liquidity concerns rippled throughout the crypto world.
Early Wednesday, Su Zhu sent a cryptic tweet, implying that Three Arrows Capital was looking to fix a problem. The popular trader said that the 3AC crypto hedge fund is in touch with relevant stakeholders and is committed to working this out.
Rumours about the company's potential problems initially surfaced on Twitter and quickly circulated throughout the day. It is being claimed that Three Arrows Capital might have missed a margin call and undergone a liquidation event due to the recent crypto market crisis.
Notably, the rumours surfaced after Celsius Network halted customer withdrawals due to what is widely assumed to be a liquidity shortage.
Reports of the problem faced by the 3AC crypto hedge fund is expected to increase the worries of crypto investors as the market has been jolted by a series of events over the last few days.
At the time of writing, the global crypto market cap had declined to US$ 907.1 billion and continues to trade below the US$ 1 trillion mark.
Bottom line
3AC crypto hedge fund is believed to be one of the most successful cryptocurrency hedge funds worldwide. From just a startup in 2012, Three Arrows Capital grew into a multi-billion dollar company within no time and got recognized for its foresight trading recommendations.
However, it appears that the present market situation is affecting retail investors and big organizations focused on cryptocurrencies. Investors need to stay cautious as the market is witnessing an increased volatility.
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