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Report: Crypto Hedge Fund Three Arrows Capital Made a GBTC Arbitrage Trade Before Rumored Collapse – Bitcoin News

Report: Crypto Hedge Fund Three Arrows Capital Made a GBTC Arbitrage Trade Before Rumored Collapse – Bitcoin News

Crypto hedge fund Three Arrows Capital (3AC) received a lot of attention last week as the firm reportedly had liquidated heavily leveraged positions and sparked speculation about bankruptcy. According to a recent report, 3AC’s over-the-counter (OTC) operation TPS Capital presented a GBTC arbitrage opportunity before the company failed to meet the margin call.

3AC Co-Founder Says ‘Terra-Luna Situation Got Us Too Far’ – FTX CEO Sam Bankman-Fried Emphasizes 3AC-like Problems That Couldn’t Happen With Onchain Protocol

Before June 14, which was Su Zhu’s last day tweetedco-founder of Three Arrows Capital Limited (3AC) was very active on Twitter. Since then, Zhu and 3AC co-founder Kyle Davis haven’t been active on social media at all, but the silence hasn’t deterred people from investigating the company. This is because different reports indicate that the 3AC positions were liquidated and some reports Estimates suggest that Terra Luna and the UST fallout crippled the company with “huge losses.” The same account indicates that it is possible that this prompted 3AC to “use more leverage to earn it back. This is also known as ‘revenge trading’,” the report said.

On June 17, it was reported Reuters And this wall street journal (WSJ) that 3AC was “exploring alternatives, including the sale of assets and a bailout by another firm.” Davis spoke with the WSJ and they told the press that “the situation in Terra-Luna bothered us a lot.” Additionally, Michael Morrow, CEO of Genesis Trading, Explained on Twitter that the firm “reduced our losses” against a larger counterparty that did not meet a margin call. He also said that no Genesis Trading client funds were affected.

Then FTX CEO Sam Bankman-Fried spoke about 3AC on June 19, and he stressed that issues such as the financial meltdown of 3AC “could not have happened with a transparent on-chain protocol.” Bankman-Fried’s statement a. stems from Question It asked how the crypto industry can ensure that a 3AC moment doesn’t happen again.

Report says 3AC’s OTC desk TPS Capital offered a GBTC-linked trade before the alleged collapse

Additionally, The Block Reporter frank chaparro published one report good said that “a few days before the explosion of Three Arrows Capital it was pitting investors on a new arbitrage trade.” Chaparro elaborated that The Block reviewed investment documents that were allegedly given to investors by TPS Capital and that the arbitration opportunity involved GBTC, a Grayscale exchange-traded product linked to bitcoin (btc), “He raised so many people,” a person familiar with the matter told Chapro.

“Three Arrows’ pitch was to structure a trade for counterparties that would offer the collapse of a waiver near the deadline for an SEC decision,” Chaparro wrote. “GBTC is currently trading at a 33.75% discount to the price of bitcoin, to be tracked.” Similar to the Celsius situation, the public hasn’t actually heard from anyone tied to 3AC. However, the Celsius Network team did publish a blog post He added that “the process will take time.”

Tags in this story

3AC, Arbitrage, BTC, Celsius Network, Celsius Position, Genesis Trading CEO, Frank Chaparro, FTX CEO, GBTC, GBTC Arbitrage, Genesis Trading, Kyle Davis, Michael Morrow, Reuters Report, Sam Bankman-Fried, Su Zhu, Terra- Luna Status, The Block Reporter, Three Arrows Capital, WSJ Report

What do you think about the 3AC position and the firm’s alleged GBTC arbitrage opportunity? Let us know what you think about this topic in the comment section below.

Jamie Redmayne

Jamie Redmayne is the News Lead at News and a financial tech journalist based in Florida. Redmayne has been an active member of the cryptocurrency community since 2011. He has a passion for bitcoin, open-source code, and decentralized applications. Since September 2015, Redmayne has written over 5,000 articles for News about the disruptive protocols emerging today.

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