stands to lose $270 million on Three Arrows loans: CoinDesk

Quick Take

  • Crypto exchange is poised to lose $270 million on loans made to Three Arrows Capital, according to a report from CoinDesk. 
  • The news was revealed in a shareholder letter stating that “remains liquid, solvent and our customers will not be impacted.”

Crypto exchange stands to lose $270 million it lent to the liquidated crypto hedge fund Three Arrows Capital (3AC), according to a report from CoinDesk on Friday. 

The news was revealed in a shareholder letter written by CEO Peter Smith, who wrote that “Three Arrows is rapidly becoming insolvent and the default impact is approximately $270 million worth of cryptocurrency and US dollar loans from”

3AC, which is now subject to a liquidation order in the British Virgin Islands, was once one of crypto’s largest hedge funds, boasting billions of dollars under management. The firm collapsed in recent weeks in response to a combination of poor risk management and declining crypto prices, with many crypto lenders impacted by the fallout.

In the letter, Smith pointed out that 3AC had borrowed and repaid over $700 million worth of cryptocurrency to throughout the four years that the firm had been a counterparty. The letter, dated June 24, also specified that “remains liquid, solvent and our customers will not be impacted.”

A report published by Bloomberg last week specified that and Deribit were among the creditors that sought the liquidation of Three Arrows in the British Virgin Islands. In the report, a spokesperson said 3AC had “defrauded the crypto industry,” and that the company intended “to hold them accountable to the fullest extent of the law.” is one of the longest-running companies in the cryptocurrency industry and one of the earliest developers of web browser wallets.

Asked about the CoinDesk report, a representative from told The Block that they had nothing to add.

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