Crypto Firms News: Connection Between 3AC, Celsius Network, and Terra (LUNA) Crash

Unfortunately, the crypto lending platforms are in a precarious position right now, as the threat of insolvency hangs over the companies. Three Arrows Capital (3AC) and Celsius Network  are two of the most prominent.

According to documents submitted by Trustee Teneo, the $3.5 billion in obligations owed by the crypto hedge fund Three Arrow Capital, commonly known as 3AC, to 30 different entities have been discharged.

According to one of the documents, 3AC took out a $75 million loan from Celsius, another crypto lending business that has recently declared bankruptcy.

JUST IN: Court filings reveal Celsius Network lent $75 million to Three Arrows Capital.

— Watcher.Guru (@WatcherGuru) July 18, 2022

 

 

In court documents, Celsius is said to have disclosed two loans to 3AC in the form of USDC stablecoin, totaling $50 million and $25 million. Since this is the case, it follows that the crashes of Celcius, the Three Arrow Capitals, and Terra (LUNA) are all related.

Immediately following Terra’s decline, 3AC also followed suit, worsening market sentiment. The Celsius platform then had a flood of withdrawal requests, prompting administrators to temporarily suspend the feature.

The report further reveals that Genesis Asia Pacific Ltd is one of the largest lenders, with a loan amount of $2.36 billion.

The collateral for 3AC loans was relatively high, totaling 17,443,644 Grayscaleinformation.

There are 446,928 shares of the Grayscale Ethereum Trust, 2,739,043.83 AVAX tokens, 13,583,265 NEAR tokens, and 1,000,000 shares of the Bitcoin Trust.

Genesis tried to get their money back, but 3AC filed for Chapter 15 bankruptcy, thus they were never able to repay the debt.

JUST IN: Court filings reveal Genesis Global issued $2.36 billion in loans to Three Arrows Capital.

— Watcher.Guru (@WatcherGuru) July 18, 2022

The Filing of  3AC Bankruptcy was Followed by Celsius

When 3AC declared bankruptcy on July 1, Celsius followed suit the next day. After filing for bankruptcy protection, Celsius disclosed a $4.7 billion debt to its customers.

The Santiment data shows that the price of Celsius has been pushed down as predicted, and this is followed by a profit loss ratio for the Celsius platform in which losses are far more pronounced than profits.