Crypto lender Celsius loaned $75 million to collapsed hedge fund Three Arrows Capital (3AC).
Documents obtained by The Block show that Celsius made two loans in the stablecoin USDC to 3AC. One loan was for $50 million and the other for $25 million. That’s according to an affidavit submitted by 3AC co-founder Kyle Davies and a notice of termination from Celsius to 3AC.
3AC fell apart after losing significant sums of money when the cryptocurrency Luna (LUNA) and its sister token TerraUSD (UST) experienced a death spiral. It led to large losses for many other crypto firms that had lent it money, often through undercollateralized loans.
Celsius has also been struggling since the collapse of Luna and 3AC and declared Chapter 11 bankruptcy in New York last week. In its initial court filings, Celsius claimed a $1.2 billion hole in its balance sheet as well as the possession of $600 million in celsius tokens (CEL) as assets (when the token only has a market cap of $188 million, implying it would be hard to redeem that value).
In the notice of termination, Celsius said that 3AC had not provided the required additional collateral, after it was demanded, nor had it made a required payment.
In the affidavit submitted by Davies, he provided data that showed 3AC owed more than $3.5 billion to a series of crypto companies.
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