Su Zhu’s cryptic statement as rumors swirl of 3AC liquidations and insolvency

A screenshot of a video game Blockchain

Su Zhu’s cryptic statement as rumors swirl of 3AC liquidations and insolvency

“We are in the process of communicating with relevant parties and fully committed to working this out” Su Zhu stated.

Su Zhu, co-founder of Singapore-based crypto venture capital firm Three Arrows Capital (3AC), has put out a cryptic statement on Twitter in response to swirling rumors that the company is battling against insolvency.

Online chatter about 3AC being unable to meet a margin call began after 3AC started moving assets around this week to top up funds on decentralized finance (DeFi) platforms such as Aave to avoid potential liquidations amid the tanking price of Ether (ETH) this week. There are unconfirmed reports that 3AC faced liquidations totaling hundreds of millions from multiple positions.

DeFi-banking platform Celsius has also been frantically shoring up positions to avoid liquidations. Celsius funds account for a significant proportion of the total value locked in various platforms in the DeFi ecosystem, while 3AC is a major borrower. The collapse of either or both would have significant implications for the entire space.

In a short and sweet Twitter post from earlier on June 15, Zhu broke his silence after around three days of inaction on social media and suggested that the company is working through its issues:

The rumors ramped up after Zhu removed all mention of investments in ETH, Avalanche (AVAX), Terra (LUNA), Solana (SOL), Near Protocol (NEAR), Mina (MINA), DeFi and nonfungible tokens (NFTs) from his Twitter bio, keeping only a mention of Bitcoin (BTC). Others have raised questions about Su deleting his Instagram and asked why both he and co-founder Kyle Davies were inactive on Twitter for three days.

A related issue is 3AC’s previous exposure to the Terra eco-system via the Luna Classic (LUNC), which experienced a multi-billion market crash in late May. The platform exchanged roughly $500 million worth of Bitcoin  with the Luna Foundation Guard for the equivalent fiat amount in LUNA just weeks before Terra imploded.

Other prominent figures in the space such as the former head of crypto Cathie Wood’s Ark Invest, Chris Burniske, also pointed to rumors of 3AC being the next firm to crumble after Terra and Celsius. Alameda Research was also loosely referenced via a meme.

Rate article
( No ratings yet )
FORECRYPTO