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The latest details of Three Arrows Capital creditors: A total of $3.5 billion is owed to 27 encryption companies, and a creditor committee has been established

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Among them, Genesis provided Sanjian with a loan of 2.3 billion U.S. dollars, becoming the largest creditor.

Original title: "Three Arrows Capital creditors lent bankrupt fund $3.5 billion, court documents show"

Original author: Yogita Khatri & Ryan Weeks & Tim Copeland, The Block ;

Original compilation: Nianyin Sitang, Odaily Planet Daily

Abstract:

- A series of documents reveals that nearly 30 crypto companies lent billions of dollars to Three Arrows Capital (3AC).

- Genesis is 3AC’s largest creditor, having lent $2.3 billion to the now-bankrupt crypto hedge fund.

- 3AC co-founder Zhu Su and the wife of another co-founder Kyle Davies are creditors of the fund.

The now-bankrupt crypto hedge fund owes $3.5 billion to 27 cryptocurrency firms, according to court documents released yesterday by liquidators of Three Arrows Capital (3AC).

The largest creditor on the list is Genesis Asia Pacific Pte Ltd., a unit of Genesis Global Trading, the brokerage arm of Digital Currency Group (DCG), which lent 3AC a total of $2.3 billion. Genesis CEO Michael Moro said recently that DCG has taken on some of Genesis' debt, but it's unclear how much of that debt remains with Genesis.

Genesis Global Trading is suing now-bankrupt Three Arrows Capital for $1.2 billion, according to a court filing. The documents show that Genesis Asia Pacific Pte. Ltd. is pursuing claims against Three Arrows for $1.14 billion in assets and collateralized AVAX and NEAR Token worth a total of $91.3 million.

Part of the collateral for these loans is 17.4 million GBTC shares, 446928 ETHE shares, 2.7 million AVAX Token and 13.9 million NEAR Token , all of which have been liquidated by Genesis.

Before the Terra ecosystem collapsed in May this year, 3AC had grown into one of the largest hedge funds in the encryption industry, and the Terra crash caused 3AC to suffer heavy losses.

Details of the 3AC loan were disclosed in a 1,157-page legal document that Teneo uploaded online on Monday. Teneo was appointed last month to oversee the liquidation of 3AC. This document outlines the claims against 3AC. Days after a British Virgin Islands court appointed Teneo as liquidator, 3AC has filed for Chapter 15 bankruptcy protection in a New York court to protect its US assets while the BVI executes its liquidation.

A spokesperson for DCG told The Block: "The balance sheets of both DCG and Genesis remain strong. With its exposure to Three Arrows now gone, Genesis continues to be well capitalized and its operations are returning to normal. .”

Other creditors

Following Genesis, recently filed for bankruptcy Voyager Digital LLC lent 3AC more than $685 million in Bitcoin and Ethereum — an amount at current cryptocurrency prices.

Other well-known creditors of 3AC include DRB Panama Inc., the parent company of the encryption trading platform Deribit, which lent 1,300 BTC and 15,000 ETH to 3AC, worth about $51 million at current prices; Provided approximately $75 million in USDC loans; CoinList Services provided $35 million in loans; FalconX provided $65 million in loans.

FalconX vice president of executive operations and partnerships, Kushagra Shrivastava, declined to comment on the size of the loan to 3AC, saying he could not provide details of relationships with specific clients. However, he told The Block that FalconX “has no significant exposure or loss,” adding that the platform’s average collateralization ratio exceeds 160%.

"Unlike other major lenders in the space, all credit on FalconX is over-collateralized against highly liquid collateral (eg excluding GBTC) and scaled within our closed-loop ecosystem, enabling FalconX to maintain ownership and control over those assets,” Shrivastava said.

He added: "Thanks to strong risk management, a market risk-neutral approach and leveraging real-time on-chain analytics, FalconX emerged from the liquidity crisis stronger than ever. Our balance sheet is the largest ever Biggest. We have continued to extend credit and have expanded our credit operations despite poor market conditions.”

When contacted for comment, a CoinList spokesperson told The Block: "We lent 3AC some assets from our own balance sheet and they have defaulted on that loan. We are in the process of trying to get those assets back. Legal proceedings. Their default will not affect any user funds, only assets on our own balance sheet. We closed our $100M Series A in October 2021, enough to provide years of operation (even if We have not recovered any loan assets) and will continue to help launch the best projects in the crypto space."

The companies are all creditors in 3AC's bankruptcy proceedings and are seeking the return of funds. Interestingly, 3AC co-founder Zhu Su and Chen Kelly, the wife of 3AC co-founder Kyle Davies, are also among the creditors, with the former claiming $5 million and the latter claiming $65 million.

Additionally, some of these creditor companies trade in Bitcoin, other crypto Token Or Grayscale Bitcoin Trust (GBTC) shares as collateral.

Other creditors listed in the filing include SBI Crypto, Equities First Holdings, Tower Square Capital, Ashla International Inc, Plutus Lending LLC (aka Abra), Moonbeam Foundation, Moonbase One and PureStake.

In addition, according to three people familiar with the matter, a creditor committee of Three Arrows Capital has been established, including five members. The committee is comprised of Digital Currency Group (DCG), Voyager, CoinList, Blockchain.com and Matrixport, sources said. Creditors vote according to their voting rights (the size of their claims), and finally elect the above five members.